In a highly impressive discussion, Uzbekistan has now legalized companies to mine several cryptocurrencies and digital assets via solar energy-powered machines and devices. Moreover, the Tashkent government has also said that it will exempt all crypto operations by domestic and foreign companies from income tax if they power their farms with solar panels. The government wants miners to power their farms with solar energy. As per the decree, mining companies can be linked with power grids if they’re ready to pay double the regular price. Moreover, during peak consumption times, extra surcharges will be levied.
Talking about the same, the document further iterated that no license is required for mining, but the company must be registered under the Uzbek National Agency for Perspective Projects. “No license is required for mining, but the company must be registered by a newly formed Uzbek National Agency for Perspective Projects,” the document read.
Cryptocurrency mining is a highly energy-intensive process
Some cryptocurrencies, like bitcoin, are created by a process known as the Proof of Work, which requires miners to solve complex puzzles on their computers to earn/mine them. This solving of puzzles requires highly complex systems that vast amounts of electricity must power. In times when electricity generation and requirements are imbalanced, Uzbekistan wants to promote cryptocurrency mining while keeping the electricity demanded such operations under control.
Although Uzbekistan legalized cryptocurrency trading in 2018, the move was only for domestic crypto exchange. The central Asian nation is known for launching a series of renewable energy projects, including solar and wind power plants. And now, the Uzbek government wishes to implement ethical energy practices in the cryptocurrency market. This new renewable legalization of crypto mining will serve as an inspiration for other countries willing to promote the status of cryptocurrency in their regions.
Kazakhstan halted its crypto mining due to the energy strain created
In fact, Uzbekistan’s neighbor, Kazakhstan, which became the world’s second-largest center for bitcoin mining after the United States, has cracked down on its mining operations after it strained its power grid backed by legacy old coal power plants.