Kazakhstan's Crypto Mining Shift: From Garage Farms to a Licensed 676 MW Industry

Kazakhstan's Shift From Unlicensed Mining to a 676 MW Regulated Sector

Kazakhstan's crypto mining industry has moved from garage, greenhouse and abandoned-factory operations to a licensed infrastructure business in roughly three years. The early 2023 Law on Digital Assets introduced legal definitions for digital mining, mining pools and licensing. Since 2024, the sector has been supervised by the Committee for Digital Assets and Breakthrough Technologies under the Ministry for AI and Digital Development, and accreditation rules for mining pools had been updated twice by mid-2026.

A legal operator now needs a licence, must register every device in a state registry—more than 460,000 devices according to Vice Minister Gizzat Baitursynov—and can mine only through an accredited Kazakhstan-based pool. The pools themselves must maintain primary and backup hardware and software systems in different cities, two independent communication channels per site, proven cybersecurity controls, 24/7 support and a Kazakh, Russian and English interface. This replaces the old grey model of undeclared equipment, foreign pools and anonymous wallets that left the grid overloaded and the budget without tax revenue.

The Treasury now sees more of the flow. Corporate income tax is calculated when cryptocurrency is credited, even if the miner has not sold it, and licensed data-centre capacity reached 676 MW by March 2026. But the fiscal picture is uneven: the sector paid about 9 billion tenge in 2023, 10.4 billion in 2024 and 7.7 billion in the first half of 2025, while the number of licensed companies rose from 43 at end-2023 to 71 in March 2026.

Legal mining carries electricity tariffs, a digital mining fee, depreciation, rent, pool charges and tax. At a bitcoin price around $72,800, market participants estimate the legal margin at 5–10%, because shadow miners can avoid the tax and fee and often use household or pre-meter electricity, roughly halving their costs. Kazakhstan is responding with new incentives, including a 70/30 energy investment program and a National Strategic Crypto Reserve, while courts and regulators continue to press illegal operators.

The Economics Behind Kazakhstan's Legal Mining Gap, 70/30 Energy Deals and Pool Security

The Licence Gap: More Companies, Slower Tax Growth

The data point that matters is not the number of licences but the economic incentive behind them. Licensed operators grew from 43 to 71, yet the sector's tax contribution has moved from about 10.4 billion tenge in 2024 to 7.7 billion for only the first half of 2025. Legal miners at a bitcoin price near $72,800 are left with 5–10% after electricity, the digital mining fee, depreciation, rent, pool services and corporate income tax. Shadow operators face materially lower costs—no mining fee, no corporate tax, and often household tariffs or direct pre-meter connections—described by market participants as roughly half the cost base. The implication is that some companies have obtained licences as a forward option but are still mining cautiously rather than at full capacity.

A criminal case from Astana underscores the enforcement side: three residents were convicted for illegal mining with state damage of 143.2 million tenge. The regulator's goal is to connect licences, registered equipment, power consumption and digital-asset flows into one auditable system. That socket–pool–tax loop, as designed, makes legal mining visible to financial monitoring and reduces the risk that mining income is hidden through anonymous wallets or used for illicit purposes.

70/30 and the Crypto Reserve Turn the State Into a Partner

The 70/30 program changes mining's relationship to the grid. A mining company that invests in modernising or expanding an existing power plant gets 70% of the additional capacity at a pre-agreed tariff, while 30% goes to the national energy system. That allows a legal miner to fix electricity costs for years and helps modernise aging energy assets. Grey miners are structurally excluded because participation requires disclosing equipment and income. The state has also created a National Strategic Crypto Reserve at the National Bank, with asset management delegated to the National Investment Corporation and rules for voluntary strategic mining in their final stage. Axiom Capital's Bolat Basheyev argues that the reserve is credible as long-term state asset diversification, not speculation, while his investor wish list is concrete: predictable regulation, VAT exemption on imported equipment, and industrial sites with ready grid connections.

Cybersecurity Is Now an Accreditation Issue, Not an IT Detail

Seven accredited pools, as counted by EMCD's Viktor Pershikov, act as the sector's transparency window: they record how digital assets are distributed among miners and report aggregated data to the state. Their obligations go far beyond bookkeeping—backup data centres, independent communication channels, penetration tests, multifactor authentication, encryption, segmentation and continuous monitoring. Reputational risk is direct: a serious incident can trigger accreditation withdrawal and client loss. tLab Technologies' Arnur Tokhtabaev and MSSP Global's Dauren Salipov describe DDoS attacks, remote-administration compromises, supply-chain attacks and ransomware as realistic threats, and argue that exchanges, pools, custodians and payment systems need joint cyber exercises rather than isolated defences.

How Miners, Investors and Pool Operators Can Navigate the New Rules

• For licensed miners sizing expansion: Treat the 70/30 program as a potential multi-year power-price hedge—70% of new capacity goes to the investing miner at a pre-agreed tariff, but entry requires disclosing equipment and income and operating through a Kazakh accredited pool.
• For investors into Kazakhstan mining: Base underwriting on the current legal margin of 5–10% at a bitcoin price near $72,800, not on licence counts; sector tax was 10.4 billion tenge in 2024 and 7.7 billion in H1 2025 despite 71 licensed companies.
• For data-centre developers and equipment importers: Factor in the state's ongoing review of the digital mining fee and the sector's request for VAT exemption on imported equipment; industrial sites with ready grid connections are named as the missing piece for faster launches.
• For pool operators: Treat cybersecurity and data protection as licence-critical: accredited pools need backup infrastructure in different cities, two independent channels per site, trilingual support and tested incident controls; a serious breach risks accreditation loss and client flight.
• For non-resident companies comparing EAEU jurisdictions: Note Russia's partial mining ban from 2025 until 2031, while Kazakhstan offers container-based deployment permitted since 2025, AIFC residents zero individual income tax until 2028 and 30% lower tax reporting.