Kazakhstan to Establish Legal Framework for Crypto

The lower house of Kazakhstan’s parliament has passed five bills relating to digital assets as the government attempts to increase its grip on cryptocurrencies with a particular focus on mining.

Per a report from the Russian news agency TASS, the lower house of Kazakhstan’s legislature, The Majilis, has approved five new crypto bills, including a legal framework for the regulation of bitcoin and cryptocurrencies. Ekaterina Smyshlyaeva, a member of the Committee on Economic Reform and Regional Development of the Majilis 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 regulation is being developed due to the country’s lack of framework regarding bitcoin and cryptocurrency mining. Smyshlyaeva also that part of the draft bills focused on the “production and circulation of secured and unsecured digital assets.” The region is also looking to establish guidelines for energy consumption as it relates to crypto mining. The framework would allow the Ministry of Energy directorial authority to provide quotas based on volume depending on the needs of the electricity grid.

One of the main purposes of the legislation is to establish the rules for the establishment of licensed cryptocurrency exchanges. To support such trading platforms, the government plans to oblige crypto miners to exchange up to 75% of their income on them, starting in 2024. Additionally, authorities also want mining pools to pay taxes on their profits and exchanges to pay fees. The bill also seeks to impose a corporate tax on cryptocurrency companies. As it stands, mining enterprises are only required to pay tax on the electricity they consume at rates that depend on the amount and price of the energy consumed to mint digital coins.

Smyshlyaeva added:

The bills also make it possible to open additional opportunities to attract investments for the construction of new generations in fields and renewable energy sources.

Kazakhstan has been very active in matters relating to cryptocurrencies. Earlier in the month, the Financial Monitoring Agency of Kazakhstan announced that it had signed a memorandum of understanding with Binance to fight financial crimes. A few days later, Binance announced that procured a license to manage a digital asset platform and provide custody services in the country.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.