Kyrgyzstan Raises $1m from Crypto Mining Taxes in 2023

Kyrgyzstan Raises $1m from Crypto Mining Taxes in 2023

Kyrgyzstan is quickly becoming a powerhouse in the crypto mining world. The nation’s government has already raked in over $1 million in taxes from the industry in 2023, and the growth looks set to continue.

Mining-related tax payments have been on the rise in recent months, according to a recent report.

In February, payments amounted to just under $8,300, but revenues climbed rapidly in April, reaching over $13,000. This trend is expected to continue in the coming months.

The nation’s Energy Minister Taalaibek Ibraev stated that the majority of crypto mining “farms” in Kyrgyzstan are affiliated with the owners of small hydroelectric power stations.

This revelation comes as no surprise, as Kyrgyzstan is blessed with an abundance of renewable energy sources, including hydroelectric power.

With the cost of electricity in Kyrgyzstan being among the lowest in the world, it is no wonder that so many crypto miners have flocked to the country in search of cheap power.

Kyrgyzstan: A New Crypto Mining Hotspot?

Ibraev, who is also the chairman of the State Committee on Energy, Industry and Subsoil Use, made the comments at a meeting of the committee in the capital, Dushanbe.

The chairman of the State Committee on Energy, Industry and Subsoil Use, Ibraev, has said that many power station owners work with crypto mining firms “on a contractual basis.”

Crypto miners have been eyeing Kyrgyz locations with great interest in recent years, as the Central Asian country has a lot to offer in terms of renewable energy sources.

Hydroelectric power, in particular, is a major draw for miners, as it is a clean and sustainable source of energy. In fact, Kyrgyzstan generates much of its power from its river networks, making it an attractive destination for crypto miners looking to boost their green credentials.

Kyrgyzstan is a landlocked country located in Central Asia. It has a population of six million people and is slightly smaller than the state of South Dakota.

Despite its small size, Kyrgyzstan possesses tremendous hydropower potential. The International Trade Administration wrote last year that up to 142 billion kWh of energy could be produced in the nation, “of which only 10% has been tapped in installed capacity.”

Hydropower accounts for the overwhelming majority of electricity produced in the Kyrgyz Republic (nearly 90 percent).

The International Trade Administration added.

Russian officials are hoping to launch a new “cross-border” CBDC trade in the EAEU (Eurasian Economic Union), a five-member economic bloc of former Soviet states that includes Russia, Belarus, Kazakhstan, Armenia, and Kyrgyzstan, sometime in 2024.

This would allow businesses and consumers in the bloc to conduct transactions with each other using digital currencies, rather than traditional fiat currencies.

The goal is to reduce the cost and complexity of cross-border trade, and to make the bloc more competitive globally.

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