Kazakhstan Eyes Potential Tax Windfall from Cryptocurrency Market

The advancement of mining and broader trading of digital assets could position Kazakhstan as a crypto hub and boost budget revenues. This was stated by the First Vice Minister of Digital Development, Innovations and Aerospace Industry, Kanysh Tuleushin, to local media.

Modernizing the Energy System

According to Tuleushin, miners could aid in modernizing the country’s energy system. Following the example of the United States, cryptocurrency mining companies could participate in balancing the energy system by consuming excess energy during periods of low demand.

“Kazakhstan has a 70/30 project where foreign investors finance the modernization of thermal power plants, directing 70% of new capacities to the national energy system and 30% to miners’ needs. Another example is the use of associated petroleum gas (APG) for data centers, which can be located near major oil fields,” noted the Vice Minister.

The APG scheme would also reduce the carbon footprint while increasing the revenues of oil producers.

Over the past three years, mining has brought Kazakhstan $34.6 million in tax revenues. Since 2023, the government has registered 415,000 units of mining equipment, issued 84 licenses (64 active, 13 suspended, and seven revoked due to the cessation of activities by their holders), and accredited five mining pools (three of which remain operational).

Expanding Cryptocurrency Operations

The official also mentioned the growing volume of trading operations on the AIFC exchanges. From 2023 to 2024, it increased from $324.2 million to $1.4 billion. From January 1, 2025, miners are required to sell 75% of assets through AIFC stock exchanges.

Experts estimate that the total volume of digital asset transactions in Kazakhstan in 2023 reached $4.1 billion, with 91.5% conducted outside state oversight, beyond the AIFC.

Moreover, the fight against illegal trading platforms continues. In 2024, authorities shut down 36 illegal crypto exchanges with a turnover of 60 billion tenge ($118 million), froze assets worth $4.8 million, blocked over 3,500 exchangers, and uncovered two financial pyramids attracting investments in digital assets.

Tuleushin predicts a significant positive effect if restrictions on cryptocurrency trading exclusively within the AIFC are lifted. He hopes that flexible rules will attract major players, similar to the UAE.

“Kazakhstan could become a crypto hub, competing with Uzbekistan and Kyrgyzstan. Legalizing the grey zone would bring billions of tenge into the budget. For example, a mere 10% tax could yield over 190 billion tenge annually ($372.9 million), enough to build dozens of new schools and hospitals from scratch,” he explained.

The Vice Minister proposed introducing flexible rules for the crypto market across the country, inviting the National Bank and the Agency for Regulation and Development of the Financial Market to discussions.

Back in April, the National Bank of Kazakhstan supported the idea of a single crypto exchange to regulate the circulation of digital assets within the country.