Kazakhstan looking to invest over $700m in crypto mining

The Central Asia nation is working on developing its crypto mining industry by lobbying for an influx of investments

Kazakhstan is looking forward to attracting 300 billion tenges (around $715 million) worth of investments for its emerging cryptocurrency mining industry, as revealed by the former Minister for Digital Development, Innovation, and Aerospace Industry Askar Zhumagaliyev in a Senate hearing held last June.

Zhumagaliyev explained that cryptocurrency mining had already become a regular occurrence and a “part of our everyday lives” after conducting a study on other nations such as the US and South Korea.

Bagdat Mussin, Kazakhstan’s latest Minister for Digital Development, revealed that the country is currently in talks to receive this investment so that they can work on expanding the cryptocurrency mining sector.

Mussin stated that “today we have preliminary agreements on attracting investments worth 300 billion tenges,” and that the country is in the process of building four more mining farms.

The Central Asian country has also introduced a proposal that would impose a flat 15% tax on the sector, in an attempt to further supplement the profits from mining cryptocurrency within the nation’s borders.

At its current rate, Kazakhstan is well on its way to being one of the world’s top three countries for mining BTC. Data obtained from The Bitcoin Mining Map, Cambridge University’s BTC mining tracking tool, shows that the Central Asian nation is already fourth on the list, and is responsible for over 6% of the global hash rate.

It is slowly catching up to Russia, which is responsible for 6.9% of the global hash rate. The two countries that dominate the list are China, who remains unchallenged at 65%, and the US at 7.2%.

If their $700 million investment in crypto mining does push through, Kazakhstan is highly likely to secure a spot in the top three.

In addition, data released by the Cambridge Center for Alternative Finance (CCAF) shows that the increase in electricity bills across China are pushing miners to look for other locations to set up their crypto mining operations. The country’s 65% global hash rate is already a notable drop from their global hash rate in September 2019, which was approaching 76%.

While miners view the US as a viable alternative, Kazakhstan is closer to the country in terms or proximity because it shares a border to the west with China. Since it also offers much cheaper electricity rates, the hash rate produced by the country has blown up to 334% in just one year as miners began to migrate their operations and equipment.