In Q1 2022, the government of Kazakhstan earned 652 million Kazakhstani Tenge ($1.5million) in Bitcoin Miners revenue. Due to the shutdown of all mining companies in the country at the end of last year, this figure was significantly lower than expected.
According to Monday’s report by Kazakhstan’s State Revenue Committee of Ministry of Finance, Bitcoin mining fees came in from 12 different areas of Kazakhstan. But, only three companies were the main payers of these fees: AISolutions and Agro Energy.
As part of the January 1, 2022 legislation, Bitcoin miners in Kazakhstan are required to pay energy charges to the state. Miners are required to pay 1 tenge ($0.0024), for each kilowatt-hour spent on electricity, every quarter. This is the 20th of each month. The committee reminds readers that a hike in this rate is being discussed in parliament.
However, the report states that Q1’s expected fees were not received by the budget because most mining companies have been “disconnected” from electricity for more than half a year. According to reports, the disconnections were done in the name “energy security” as mining has been a problem in the past and could have contributed to blackouts.
Although mining consumes only a small fraction of global energy, Kazakhstan is home to a large portion of the industry. This central-Asian country has a population of less than 19 million, but it is responsible for 13.22% global hash rate. It is also the third largest Bitcoin mining hub.
The state had closed down 106 mines in the region as of March. The government is currently considering a new mining tax that is based on Bitcoin’s value so that the budget of the country will indirectly benefit from its appreciation.
Electric Grids vs. Miners
Iran, another country with a high hash rate, is cracking down on illegal mining activities within its borders. Similar blackouts have been experienced by the country in the past. They responded with a seasonal mining strategy that ensures that miners don’t overload the grid during peak demand.
Texas has, however, taken the contra-intuitive approach and invited more miners into the state to address blackouts. Governor Greg Abbott believes the mining industry will encourage the development of more power-generation facilities in the region to stabilize the weak grid.
Marla Brooks – Financial Analysis
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