Uzbekistan limits BTC mining to legal entities, solar power

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Uzbekistan has published new regulations for the block reward mining sector that relegate the industry to only tapping solar power for operations.

Uzbekistan first legalized BTC mining through solar power in May 2022. In a presidential decree, the government noted that miners can still tap the national grid, but only if they are ready to pay twice as much as other industries. During peak demand periods, the grid operator can also levy additional fees. The decree also gave the newly formed Uzbek National Agency for Perspective Projects (NAPP) jurisdiction over the sector.

In its latest decree, the NAPP doubled down on miners only using solar energy to power their facilities. However, they can tap the grid in special cases as stipulated by the law. The order didn’t offer any details on these special cases.

Uzbek miners are barred from mining anonymous digital assets like Monero, which allow users to obscure transactions. While Uzbekistan is one of the few barring the mining of these digital assets, many other countries have banned their trading or listing. The EU, South Korea, and Japan have all prohibited anonymous digital assets to some degree.

In Uzbekistan, only legal and licensed entities can mine digital assets, as per the new decree. They must also register their operating facilities and refrain from conducting any mining activities beyond these recognized facilities. All miners must promptly pay all the mining fees imposed by the NAPP.

“The agency also asks all citizens to act within the framework of the law and refrain from attempting to organize activities in the field of circulation of crypto-assets without obtaining the appropriate license,” the agency said.

While Uzbekistan is tightening its BTC mining regulations, its neighbor Kazakhstan has been squeezing them out through exorbitant power prices. In a letter this week, miners implored the president to cut down the energy prices, saying they will all be forced to shut down if the prices remain as high.

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