- The Kyrgyz Republic is reportedly expanding its cryptocurrency mining capabilities with the support of the local government.
- Kyrgyz President Sadyr Japarov has given approval for the construction of a crypto mining farm at a hydroelectric power plant in Kyrgyzstan.
- The government plans to invest up to $20 million to build the mining facility at the Kambar-Ata-2 Hydro Power Plant.
- The president stated that operating a crypto mining farm will help the government avoid energy losses associated with unused power from the plant.
- Since its launch in 2010, Kyrgyzstan has lost 6.8 billion kilowatt-hours (kWh) of energy due to this issue.
- By establishing the mining farm, the government aims to utilize the remaining energy effectively and bring benefits to the country’s budget.
- The president emphasized that the funds generated from the mining farm will be directed towards the power engineers for the benefit of the people.
- A state of emergency in the energy sector of Kyrgyzstan is scheduled to begin on Aug. 1, 2023, and end on Dec. 31, 2026.
- The emergency situation is caused by climate challenges, low water inflow into the Naryn River basin, and the lack of generating capacity due to excessive energy consumption.
- Crypto mining in Kyrgyzstan will be subject to the highest tariff rate, around 5 Kyrgyzstani soms ($0.057) per kW.
- The government of Kyrgyzstan has been exploring cryptocurrency as an opportunity to boost the local economy.
The press office of the Kyrgyz government did not immediately respond to Cointelegraph’s request for comment.
Government authorities in Kyrgyzstan have increasingly shown interest in legalizing and regulating the cryptocurrency industry to stimulate economic growth.
In March 2022, Kyrgyz lawmaker Karim Khanjeza called for the development of a legal framework for crypto in Kyrgyzstan, highlighting the rapid growth of the industry.
Despite introducing some regulations for crypto exchanges in 2021, Kyrgyzstan has not enacted any specific crypto-related laws.