Continuation of the interview with
Apytioh about the current situation in Kazakhstan.
July 2021.
Enjoy reading!
Please tell us what is happening in the cryptocurrency business in Kazakhstan?"In short, there is a change in trends. If before there was a catastrophic shortage of cryptocurrencies, now, with the arrival of foreign investors and Chinese miners, there are a lot of them. This affected exchange offices, now all exchangers have full reserves, commissions are changing, that is, if earlier the buyer had to pay 2-3-4-5% extra, now it comes to the point that exchangers give 0.5% more cryptocurrency for your fiat.This is due to the fact that the miners who arrived from China brought with them a lot of cryptocurrencies, which they here they exchange for fiat to pay for their costs associated with the launch of mining.Also there is information that after the adoption of the law on mining by the President of the country and the full legalization of this activity, private foreign investors come, who also bring cryptocurrencies, which they pay here for starting their business. In general, Kazakhstan is slowly turning into the mining capital of the world."
Bitcoin has lost about half of the hashrate, what % of the share of the lost hash rate can Kazakhstan accept?“Theoretically, Kazakhstan can accept everything! But in practice, most likely it will be possible to take no more than half, I think that a third of the capacity will come to us.
For a month now, the pool of BTC.com has been gradually moving to us in Kazakhstan, there is confirmed information about the relocation of two other large Chinese miners, and there is also information that with the adoption of the law, rich Arabs began to invest in this business. A year ago, in terms of hashrate share, Kazakhstan was 4th after Russia, but in the second part of 2020 we overtook Russia. Now Kazakhstan is chasing the United States in terms of hash rate. I think that when everything calms down and the movement of miners stops, there will be 3 major players in the world: China, USA, Kazakhstan. "
What taxes are miners required to pay? What is the cost of electricity for miners. Are there any consumption restrictions?"The President adopted a law on mining, all miners will be required to pay an additional 1 tenge (1 RUB = 5.9 tenge; $ 1 = 430 tenge) to their current electricity tariffs. There are no other laws yet, but there is still a law under consideration that charge some percentage from the miners when they sell the mined cryptocurrency.That is, while you are mining, you just pay for electricity, but when you fix a profit or loss and exchange the mined cryptocurrency for fiat, you will have to pay for it too. not yet adopted, but has been under consideration for a long time.
The cost of electricity varies. Depends on the region, in the north it is cheaper, the west and east are more expensive, the highest tariffs are in the south. But on average it is 4-5 cents per kW. Major players most likely found options for 3 cents.
The consumption limits are also individual, depending on the place where you connect, there is no single standard. "
Is there a big shadow mining market in Kazakhstan?"No, it used to be quite large, but in recent years most of the shadow market has been closed. It is not difficult to find large illegal mining farms, so there are probably very few of them left now. As a rule, these are small private traders. But given our Soviet mentality, I dare to assume that there are large miners who pay bribes and work illegally."
According to information from Wikipedia, 87% of electricity production in Kazakhstan is the combustion of coal, oil and gas, which leads to additional carbon emissions into the atmosphere. Does Kazakhstan have a government policy on this issue?
"It's hard to say in percentage terms. But yes, burning of minerals is a large part of electricity production, but there is no government policy in this matter."
Are there any green energy projects in Kazakhstan?"Yes, of course. There are hydropower plants and wind farms. There are also small solar projects, but what I know is that these are not industrial mining projects."
What does a miner need to do to start working in Kazakhstan?“I don’t have a definite answer to this question. The law has been written and adopted, but it’s not a fact that you will be able to take advantage of it. Everything is at an early stage and there is no clear algorithm for starting this business.
As a rule, this is solved with the help of business contacts, acquaintances or by paying money to the owner of the electricity access point, and then everything works according to the law. Recently, a certain investor "paid" $ 450,000 to the owner of a 14MW station to start mining. That is, he just bought the opportunity to mine, then he will pay according to the tariff as required by law. "
What are your partners planning to do? Will they expand or manufacture mining equipment?"The production of equipment is too complicated a process, but the production of mining containers, the launch of turnkey mining sites, hosting and equipment repairs are ongoing. And now the demand for this is growing at a good pace. There are two companies, B2C mining LLP and B2C service LLP. The first company is engaged in the construction of mining containers, it is also possible turnkey delivery of a specific project and further hosting.
The second company is engaged in the repair and maintenance of mining equipment of any type. You can find the websites of the companies on Google, and there are also reviews of the products of these companies on YouTube. "
In Russia, miners buy private houses and receive a 15-30 Kilowatt limit at the rate for individuals. Does this practice work in Kazakhstan?“I haven’t heard about this. There are home miners that mine Ethereum, Ethereum Classic, etc., but I haven’t heard about home BTC miners. In Kazakhstan, not everyone can get 30 kW per home, it will be expensive.”
Is it possible to get rich mining in Kazakhstan now? What is the payback period of investment in mining now?“Of course you can! If you are a miner in Kazakhstan, consider that you have taken a franchise from the Fed and are printing money, legally and legally. It all depends on your experience, ambitions, capabilities and strategic planning.
In terms of payback periods, I adhere to the point of view that it is pointless to calculate it. The complexity of the network can change by 10-20 percent daily, and in both directions, I will not say anything about the
BTC course. So what's the point if these numbers change every day?
But according to my observations, I will say the following, when the current payback period is less than 6 months, it means that these periods are more likely to increase soon, you run the risk of entering the market when demand starts to fall. And when the current payback period is more than 1.5 years, then most likely, after a short time, everything will change in your favor.
Warren Buffett's rule of thumb: "Be afraid when everyone is greedy, and be greedy when everyone is afraid."
Thus, I have developed for myself the following pattern, the more unprofitable the start of mining in terms of payback period, the better this entry point, and vice versa. "
What interesting insights can you share from your experience?"I can talk a lot on these topics, but I will say the most interesting thing in my opinion.
China is the total hashrate leader and suddenly it passes a law banning non-environmentally friendly mining.
The persecution of miners begins, using electricity, which is produced by burning coal and other minerals.
But I, my colleagues and other people from the cryptocurrency market have already met several Chinese who were expelled from the country, although they had absolutely environmentally friendly mining, they used hydroelectric power stations.
After that, there was news on ForkLog, where it was said that in China a large number of hydropower plants with capacities up to 50MW were put up for sale after the miners left there.
It turns out that China has expelled not only those who violate the environment. What is it? Some kind of game? Or a conspiracy?
How can a power like China abandon its dominant position in such a niche as mining? This is a big question for me. Either something special awaits us, or the Chinese government will now supply its own equipment and will mine into the state treasury at the points of the expelled miners. This is a big question for me, and I hope to get an answer to it soon. "
Original:
https://bitcointalk.org/index.php?topic=5313734.msg57431412#msg57431412If you find mistakes in translation, write to me.
Thanks
Apytioh for your time.
Hope you enjoyed it!
Feel free to ask him questions.
Disclaimer: This article is for educational purposes. Don't consider this material as investment advice!
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