Kazakhstan to Launch $1 Billion Crypto Reserve

[VirDolorum]

I think they're following Kyrgyzstan: https://btcusa.com/kyrgyzstan-launches-national-stablecoin-and-cbdc-on-bnb-chain-with-binance-support/

[shield132]

To my mind, crypto adoption is not the government buying and holding crypto as part of their national reserve but the ability to allow citizens to pay for different services via cryptocurrencies. If they do this and we will be able to pay various services via crypto, like paying for a passport, fines, paying government-related services and etc, then I will call it a true adoption. Holding Bitcoins is a mere adoption.

It's smart for Kazakhstan to be bold in crypto-related services. This niche is rarely occupied and the first country that occupies it, will have a brighter future than the other countries.

Doesn't the article say where they'll get the bitcoins? Confiscated bitcoins from miners, or from the population they believe isn't complying with the laws they've made up. The state will line its own pockets, but it won't allow its own population to do the same.

I've never asked where they'll get their Bitcoins. Btw, why would they confiscate Bitcoins from miners? Were there issues about Bitcoin mining in Kazakhstan? I always thought that they were very mining-friendly. Btw local government in my country really lines its own pocket. BitFury has very cheap electricity rates in my country, thanks to the local billionaire who gets a share of the profit from it. BitFury uses lots of electricity and pays almost nothing, while the local population pays increased electricity rates. It's not normal but the local government ignores it and does whatever it wants because they can.

[davis196]

Kazakhstan is planning to launch a $1 billion national crypto reserve fund, aiming to diversify its economy and reduce reliance on oil.
That’s a massive move for a country that was once known mainly for its mining industry.

If this pushes through, Kazakhstan might become one of the few countries officially holding crypto as a national asset. Imagine if more governments start doing this, turning Bitcoin and other digital assets into part of their national reserves. This could change how we see crypto adoption at a government level.

just wanna share a good news.  

1 billion USD is a good start, but this news won't have any short term influence over the cryptocurrency market.
AFAIK, Kazakhstan is one of the countries, where cryptocurrency mining was very popular. I don't know if this has changed in the last 2 or 3 years. I don't see this as an diversification of their economy. This more like a diversification of their financial reserves. The economy of Kazakhstan will keep relying on the oil export. I don't know about any crypto related industries, that are able to generate a massive amount of new jobs. Maybe this form of crypto adoption is a part of their plan to de-dollarize their finance and foreign trade.

[GreatArkansas]

Kazakhstan is planning to launch a $1 billion national crypto reserve fund, aiming to diversify its economy and reduce reliance on oil.
That’s a massive move for a country that was once known mainly for its mining industry.

This is good news; the virus is spreading.

This is the effect of other countries initiating it. Just like El Salvador, the United States, and many more countries. For me, it's still early and I believe these countries who starte to practice this will have better future and they are being role model countries.

[lovesmayfamilis]

I've never asked where they'll get their Bitcoins. Btw, why would they confiscate Bitcoins from miners? Were there issues about Bitcoin mining in Kazakhstan?

Not everything is as rosy as the government would like to present it.
https://ru.investing.com/news/cryptocurrency-news/article-2634711
https://digitalbusiness.kz/2023-02-08/pochemu-iz-kazahstana-ushlo-do-70-majnerov-kriptovalyut/

[Lucius]

Bitcoin should be for ordinary people, not for governments and central banks.

I like to believe that BTC is not for any particular group of people, but for everybody and even if you and i don't like it, the government can also get some for themselves if they want. Censorship resistance is something we bitcoiners peddle a lot and that is exactly how Satoshi designed the network to be. In other words, since he created the network this way, he must have known from the beginning that a time will come when institutional investors and governments will accept BTC, because nothing stops them from doing so.

Everyone has access and that is not in dispute, what is in dispute is that any country or its central bank that buys Bitcoin is actually creating a paradox considering that it is buying a decentralized cryptocurrency to which it refers in a centralized way, treating it as fiat. Besides, "they" are not buying, but confiscating what they will call "tainted coins".

Of course, no one can stop anyone from investing in Bitcoin, but it really doesn't make sense if it's kept by a central bank as some kind of digital gold instead of being used as a decentralized cryptocurrency - which is of course made all the more difficult because many have started checking every transaction and looking for "problem coins".

[hd49728]

Everyone has access and that is not in dispute, what is in dispute is that any country or its central bank that buys Bitcoin is actually creating a paradox considering that it is buying a decentralized cryptocurrency to which it refers in a centralized way, treating it as fiat. Besides, "they" are not buying, but confiscating what they will call "tainted coins".

Of course, no one can stop anyone from investing in Bitcoin, but it really doesn't make sense if it's kept by a central bank as some kind of digital gold instead of being used as a decentralized cryptocurrency - which is of course made all the more difficult because many have started checking every transaction and looking for "problem coins".

Tainted coins can be checked on chain but there is probabiity of inaccurate on chain analysis by governments or any companies. We can not know when an exchange dies, and when governments consider bitcoins in an account on centralized exchange has tainted coins, and make order for confiscating it. It's risky to store bitcoins on centralized exchanges and if we know this risk of confiscation, and quickly severe action from governments, we will look for safer storage option like non custodial wallets.

We can store our bitcoins at home, and we can proactively reduce risk of having problems with governments.

Blacklists, taints and wallet fingerprinting.

[Hamza2424]

Kazakhstan is planning to launch a $1 billion national crypto reserve fund, aiming to diversify its economy and reduce reliance on oil.
That’s a massive move for a country that was once known mainly for its mining industry

No, It is not right to say one of the few nowadays many countries officially or unofficially holding btc. Although with investment in BTC, they can't really become independent from other industries like oil etc.

It will open another stream of income for the government and when governments have a lot of money, especially like this they work on their tourism sectors and other fields necessary for their country's long term existence.

Anyway, the step they are taking is really great, especially for btc, because now another $1 billion is going to be invested or already invested in btc.

[livingfree]

I think they're following Kyrgyzstan: https://btcusa.com/kyrgyzstan-launches-national-stablecoin-and-cbdc-on-bnb-chain-with-binance-support/

There is a need to have an audit on this one if they're going to launch a national stable coin.

Because with plans of having a billion crypto reserve, they can generate money out of thin air if they're just free to do that and use it to have more better crypto like Bitcoin.

For me, it's still early and I believe these countries who starte to practice this will have better future and they are being role model countries.

Yes, it's still too early and just like the early days. Whoever are early on the adoption gets the most out of its benefits in the coming years.

[Z-tight]

Of course, no one can stop anyone from investing in Bitcoin, but it really doesn't make sense if it's kept by a central bank as some kind of digital gold instead of being used as a decentralized cryptocurrency - which is of course made all the more difficult because many have started checking every transaction and looking for "problem coins".

I agree with you, i store my BTC's in my self custody and i recommend everyone do the same. Is it possible? No. Institutional investors and governments would rather choose etf's and custodial means of storage, maybe because they consider it more convenient than being their own bank. And not only them, there are also a lot of retail investors who are guilty of using centralized exchanges as wallet. My point here is that when it comes to storage, even the 'ordinary people' are guilty of giving up custody of their coins.

[hd49728]

I agree with you, i store my BTC's in my self custody and i recommend everyone do the same. Is it possible? No. Institutional investors and governments would rather choose etf's and custodial means of storage, maybe because they consider it more convenient than being their own bank. And not only them, there are also a lot of retail investors who are guilty of using centralized exchanges as wallet. My point here is that when it comes to storage, even the 'ordinary people' are guilty of giving up custody of their coins.

Convenience is good but with potential risk on your fund safety and lack of self-control, it's like you put your money into bags of the others and hope that they will pay you when you submit your withdrawal. It's risky while it is not controlled by you.

Bitcoin with blockchain allow users to have self-control, their own banks if they use non-custodial wallets for storing their bitcoins. It is safest to do from individual, business to institutional investors and even governments with seized bitcoins from criminals. Puting our money into hands of someone else, any company and believe that as custodians, they will keep our coins safely is too unrealistic.

Reminder: do not keep your money in online accounts.

[Iranus]

This is a nice movement by the Kazakhstan government for considering having Bitcoin on its reserve. Because as it it will be quite better than having gold bar in reserves, whose long term value can't be equated to Bitcoin.

Although bitcoin offers better returns in the long run, when it comes to stability and the ability to protect a nation’s economy from sudden economic instability. Gold bars are still a more reliable option than bitcoin at this stage. That is why they have no intention of investing in it directly and just use the available (confiscated) bitcoins as reserves.

But however, one thing that is important here is that having your country's in Bitcoin or gold doesn't stop it from being who reliance on oil. Because oil is actually their primary natural resources through which they boast their economy and generate funds. But diversitying it now only gives the fund more future value. Because Bitcoin is known to have a strong influence and monetary when invested and held long term.

The primary purpose of national reserves is not to promote economic growth but to protect the economy in times of emergency or instability. Kazakhstan added bitcoin to its reserves simply to diversify and reduce its dependence on USD or other countries' currencies to mitigate risks. They are not doing this to grow the economy and reduce their dependence on oil.

[Lucius]

I agree with you, i store my BTC's in my self custody and i recommend everyone do the same. Is it possible? No. Institutional investors and governments would rather choose etf's and custodial means of storage, maybe because they consider it more convenient than being their own bank. And not only them, there are also a lot of retail investors who are guilty of using centralized exchanges as wallet. My point here is that when it comes to storage, even the 'ordinary people' are guilty of giving up custody of their coins.

All these people unfortunately got lost in what I would call a "Bitcoin adventure", because buying the same and giving it to someone else for safekeeping is total stupidity. If you read what people like CZ say (99% of people will lose crypto if they keep it in non-custodial wallets) and how various companies and funds treat it, then I'm not surprised that there are a lot of people who think wrongly about all this and who set a bad example for others.

[Z-tight]

Convenience is good but with potential risk on your fund safety and lack of self-control, it's like you put your money into bags of the others and hope that they will pay you when you submit your withdrawal. It's risky while it is not controlled by you.

I know this and that is what i was talking about. I don't seek convenience when dealing with my funds or my money, i only focus on security and that is what everyone else is supposed to do. It is not even a bad thing to go as far as being paranoid about the security of your funds. However, many people, some of which are even members of this forum, still entrust their funds in the hands of centralized services, because they are scared to be their own bank. They believe that Binance and co. will be a safer alternative for them.