Kazakhstan advocates creating a legal framework for crypto

Share IT

Key Takeaways:

  • The Kazakh government wants to implement a specific legal framework for cryptocurrencies.
  • The Majilis of Kazakhstan, the lower chamber of the nation’s parliament, reportedly gave its approval to five laws pertaining to cryptocurrencies.

Kazakhstan, one of the most important locations for crypto mining activity, is now considering making crypto mining obligatory for all miners working in the country. Majilis, Kazakhstan’s lower house of parliament, presented the measure on Wednesday, October 12.

According to a recent report by Tass, a renowned Russian media outlet, the Kazakh government aims to implement a legal framework specifically for cryptocurrencies such as Bitcoin. The Majilis of Kazakhstan, the country’s lowest house of parliament, is said to have approved five crypto-related measures.

The legislation’s principal objective is to establish regulations for the operation of a new class of financial organisation for Kazakhstan: authorised cryptocurrency exchanges. Starting in 2024, the government intends to compel cryptocurrency miners to exchange up to 75% of their earnings on these trading platforms in order to maintain them.

Thus, the bill proposes charging taxes such as corporate income tax, mining pool income tax, cryptocurrency operating fees, and corporate income tax on miners’ revenues in addition to the present equipment import VAT and digital mining fees per kilowatt.

A member of the Mazhilis’ Committee for Economic Reform and Regional Development, Ekaterina Smyshlyaeva, said:

“Deputies of the Majilis of the Parliament have developed a sectoral bill on digital assets of the Republic of Kazakhstan and four related bills as a legislative initiative.”

The deputy continued by saying that the laws will enable the opening of new doors and draw capital for the construction of new power plants. Smyshlyaeva added that non-residents had previously used cloud services to conduct mining operations. 

Kazakhstan served as the blockchain industry’s raw material appendage. By passing laws, we force miners to obtain licenses in Kazakhstan, which entails becoming legal businesses and becoming full-fledged tax-paying citizens. The economy is also beginning to include mining pools.

In particular, Kazakhstan is working to develop a framework for the power used in the mining of digital assets. The regulations would provide the Ministry of Energy the authority to assign volume-based quotas based on the needs of the electric system.

The government also wants exchanges to pay fees and mining pools to pay taxes on their earnings. The bill’s proponents plan to tax cryptocurrency companies corporately as well. The only taxes that mining operations are now required to pay are on the electricity they use, at rates based on the quantity and cost of the energy used to create a digital currency.

Additionally, almost 1 million Kazakhs currently trade on foreign exchanges. They will all be added to local exchanges, according to the administration.

According to Smyshlyaeva, “We make cryptocurrency transactions transparent by moving them all to Kazakhstani exchanges. The project states that cryptocurrency exchanges will be integrated with the State Revenue Committee’s information systems and will be the subject of financial monitoring.”

A mining equipment registration will prevent the operation of illegal data centres, and licensing will finally find a solution to the issue of “grey miners,” guaranteeing the safety and balance of the energy system.

Share IT
Aadrika Sharma
Aadrika Sharma

I enjoy writing and try to learn new things every passing day!

Get Daily Updates

Crypto News, NFTs and Market Updates

Claim Your Free Trading Guide

Sign up for newsletter below and get your free crypto trading guide.

Can’t find what you’re looking for? Type below and hit enter!