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Kazakhstan:
The Legal Regulation Of Cryptocurrency And Digital Mining In Kazakhstan
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Today, cryptocurrency and digital mining are attracting more
interest from investors. At the same time, digital mining is
expensive and risky business, which has become complicated by the
different approaches of states to the legal regulation in this
industry. Therefore, investors need to learn the project’s
costs and choose a profitable jurisdiction for the implementation
of their projects.
With this article, we would like to describe the legal
regulation of cryptocurrency and digital mining in Kazakhstan.
We note that the legal regulation of digital mining is now at
the stage of formation in Kazakhstan. So, the article reflects the
information based on current legislation.
Is digital mining legal in Kazakhstan?
Yes, digital mining is legal in Kazakhstan. In July 2020,
Kazakhstan legislation established a legal regime for mining and
cryptocurrency. About 17 mining farms are already working
officially in Kazakhstan.
Is it necessary to obtain a special permit/license to carry
out digital mining in Kazakhstan?
Yes, as of the date of publication of this article, Kazakhstan
legislation provides for the following business authorizations for
digital mining activity:
- A company must obtain permission for the import encryption
(cryptographic) equipment from the National Security Committee of
the Republic of Kazakhstan; - A company must notify the Ministry of Digital Development,
Innovation and Aerospace Industry of the Republic of Kazakhstan
about the planned activities (before design) for the construction
of data centers (mining farms).
Are there any special taxes on digital mining in
Kazakhstan?
Yes, from 1 January 2022, a tax on digital mining comes into
force in Kazakhstan. The tax rate – 1 tenge ($0,0023) per 1
kilowatt-hour of electrical energy consumed by digital mining.
The digital mining tax is a special tax for mining companies,
but in addition, the company has other general tax liabilities.
Some general taxes in Kazakhstan include: CIT – 20%, VAT – 12%,
PIT – 10%.
Is it possible to sell/rent/lease hash rate from
Kazakhstan?
Kazakhstan legislation has neither rules governing operations
with hash rates directly nor restrictions on this issue. Therefore,
operations with hash rates are legal in Kazakhstan.
However, please note that Kazakhstan legislation
characterizes cryptocurrency a form of property, not a financial
instrument or means of payment. The Kazakhstan law prohibits an
issue and a circulation of cryptocurrency in
Kazakhstan.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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