Uzbekistan has launched Besqala Mining Valley for cryptocurrency mining, focusing on green energy and tax incentives.
Uzbekistan has initiated a significant move in the cryptocurrency sector with the establishment of the Besqala Mining Valley in Karakalpakstan. This decree, signed by President Shavkat Mirziyoyev, aims to create a dedicated zone for cryptocurrency mining across the entire republic.
The Besqala Mining Valley is designed to promote mining operations utilizing sustainable energy, seeking to attract both domestic and foreign investments. Miners will have the option to tap into the national power grid as well as alternative energy sources, such as hydrogen stations, with the added benefit that excess heat generated can be redirected to heat greenhouses.
Participants in the mining zone will have the flexibility to trade cryptocurrencies on both local and international exchanges, as well as through direct transactions. Additionally, they can deposit their earnings directly into local bank accounts.
From now until January 1, 2035, income generated by miners in this zone will be exempt from taxes. Instead, they will contribute a monthly fee of 1% of their revenue to the administration of the mining valley.
The electricity rate for miners is set at 1800 soums per kWh, which is double the standard rate for the second group of consumers. However, projects with investments exceeding $100 million may qualify for special exceptions.
Only businesses that are registered in Karakalpakstan can apply for residency in the mining zone. Applicants must provide appropriate facilities and operational electrical networks, and neither the directors nor the founders can have any prior convictions for economic crimes.
To begin operations, a legal entity must first secure resident status and obtain authorization from the National Agency for Advanced Projects. It is also noteworthy that as of January 1, Uzbekistan has recognized stablecoins as a legal means of payment.
