Kazakhstan’s Vice Minister suggests that crypto regulation should be relaxed to develop the country as a regional crypto hub

What’s new? Kazakhstan has the potential to become the leading crypto hub in Central Asia if regulatory restrictions are eased, First Vice Minister of Digital Development, Innovation and Aerospace Industry, Kanysh Tuleushin, said. In an interview with Kazakhstanskaya Pravda, Tuleushin said that mining and policy changes could position Kazakhstan as a regional leader in blockchain innovation.

Material by Kazakhstanskaya Pravda

What else is known?

“If all restrictions were lifted and digital asset trading was allowed across Kazakhstan, the impact could be significant,” the official writes.

He also believes that wider legalization and the introduction of taxation could add hundreds of billions of tenge to the national budget.

Tuleushin said that mining companies could play a key role in modernizing the country’s energy infrastructure. He noted that, as in the United States, miners could help balance the energy system by consuming excess resources.

Under the 70/30 energy initiative, foreign investors are financing the modernization of thermal power plants, with 70% of the generated power going to the national grid and 30% allocated to miners.

He also proposed using associated petroleum gas (APG) from oilfields to power data centers to reduce emissions and generate revenue for oil producers.

Kazakhstan’s mining sector has already contributed $34,6 million in taxes over the past three years. As of 2023, the government has registered 415 000 mining machines, issued 84 licenses, and accredited five mining pools, Tuleushin said.

Cryptocurrency trading volume on the Astana International Financial Center (AIFC) exchange grew from $324 million in 2023 to $1,4 billion in 2024. From 2025, miners will be required to sell 75% of their mined assets through AIFC platforms.

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Despite progress, cryptocurrency transactions remain largely unregulated outside of AIFC, with an estimated turnover of $4,1 billion in 2023, 91,5% of which took place outside of government oversight.

Authorities shut down 36 illegal exchanges in 2024, freezing $4,8 million in assets and shutting down two Ponzi schemes.

The country is also creating a domestic central bank digital currency (CBDC), the digital tenge. Development began in February 2023, with an initial launch scheduled for 2025.

Besides Kazakhstan, other Central Asian countries such as Uzbekistan and Kyrgyzstan have also adopted a friendly stance towards the digital asset industry.

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On May 7, Binance signed a memorandum of understanding (MOU) with the National Investment Agency of Kyrgyzstan to implement cryptocurrency payment infrastructure and blockchain education in the country.