Uzbekistan Government: Pay 300% Electricity Bill For Mining Cryptocurrencies

When Uzbekistan declared it wouldn’t treat cryptocurrencies as securities, we saw its citizens smiling. This smile strenghtened as miners were part of this scheme. In fact, crypto mining was not only legalized but also state-controlled energy companies were told to allocate lands for mining operations. 

All this was last year.

This year? The smile will be wiped off with a new declaration.

According to this announcement, the Cabinet of Ministers of the Republic of Uzbekistan
drafted a bill with this proposal: all cryptocurrency miners should pay 300% on their electricity bills. Be it any form of crypto mining — you are bound to pay triple the bill. 

Crypo Mining To Get Uber Expensive

In a county like Uzbekistan, which is the largest producer of electricity in Central Asia and electricity is cheap, this comes in as a shock. As per the announcement:

Consumers, regardless of the connected capacity, carrying out activities on crypto assets, including mining (activities to maintain and create new blocks with the ability to receive remuneration in the form of new units and commission fees in various cryptocurrencies), pay for electricity using an increase factor in 3.0 times the established tariff of the corresponding tariff group. 

There are a couple of reasons behind this. First, this bill’s agenda is to save energy.
Second, the government looks at mining as an energy-consuming process, and they can only curb this process by adding restrictions. Restrictions like 300% electricity bills. Third, mining has been profitable, and this is the only way the government can make more money.

Now how will this be tracked is unknown. For now, this is a draft bill, and the comments are open until October 12th. One of the commenator said crypto miners should be treated as entrepreneurs. Like an entrpreneur creating a product and selling it, miners also creating tokens (mining) — and selling it. 

Another commentator adds the issue with such mining rule. As per the translation, he says: 

By accepting such mining cost, you will drive all the miners to work in the dark. This simply creates shadow economy and the growth of illegal electricity consumption.

In between all this, the country is trying to modernize its power systems as its vast electricity supply comes through renewable energy.

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