Electricity Rationing for Crypto Mining in Kazakhstan: How the State Controls Power Use

When China shut down crypto mining in 2021, thousands of mining rigs packed up and moved east-to Kazakhstan. Within two years, the country became the world’s second-largest Bitcoin mining hub. But the sudden surge in power demand didn’t come with a warning. Homes went dark. Hospitals struggled to keep life-support machines running. And by 2023, the government realized it had a crisis on its hands.

How Kazakhstan Took Control of Mining Power

Kazakhstan didn’t ban crypto mining. Instead, it built a system to control it. The Ministry of Energy now runs a state-controlled electricity marketplace where only licensed miners can buy power. No private deals. No direct contracts with utility companies. Every kilowatt-hour has to go through the government’s platform.

Here’s how it works: each mining farm can buy a maximum of 1 megawatt-hour per transaction. That’s not much for a large operation. To keep running, a 10-megawatt farm needs 10 separate purchases a day. It’s not just a limit-it’s a bottleneck. The system forces miners to plan, track, and document every purchase. And if you’re caught buying more than allowed? Your license gets revoked.

There are only 84 active mining licenses in the country. Each one is tied to registered equipment-415,000 machines logged in a national database. That’s not just paperwork. It’s surveillance. Every rig’s power draw is monitored. If your energy usage spikes without a purchase record, the system flags you.

The 75% Rule: Forced Sales on AIFC

Owning Bitcoin isn’t enough anymore. In 2025, Kazakhstan made it law: miners must sell 75% of their cryptocurrency earnings on the Astana International Financial Centre (AIFC) platform. That’s up from 50% in 2024. The goal? Bring crypto transactions into the open financial system.

This rule hits small operators hardest. A miner in Almaty with a 50-kilowatt rig might earn $3,000 a month in Bitcoin. Now, they have to sell $2,250 of it through AIFC-paying fees, waiting for approvals, filling out tax forms. Many can’t afford the compliance cost. The rest? They either shut down or go underground.

The government says this prevents money laundering. But critics argue it’s just another tax. A 15% profit tax on mining income, plus the forced sale, means many miners are left with less than half their earnings. Some report spending 10-15% of their budget just on legal and accounting help to stay compliant.

The .5 Million Heist: How Illegal Mining Still Thrives

Despite all the rules, theft is rampant. In October 2025, authorities in East Kazakhstan Oblast uncovered a massive illegal mining operation that had stolen over 50 megawatt-hours of electricity-worth 9 billion tenge ($16.5 million)-over two years.

The power wasn’t stolen from the grid. It was stolen from people.

Corrupt utility workers diverted electricity meant for schools, hospitals, and apartment buildings straight to hidden mining farms. Investigators found the stolen power was enough to run a city of 50,000 to 70,000 people. The profits? Used to buy two luxury apartments in Nur-Sultan and four new cars. All were seized.

This wasn’t a lone case. It was a system. Utility insiders were selling access. Miners were paying cash. No records. No licenses. No taxes. And for two years, no one noticed.

The government now says it’s cracking down. But the fact that this went undetected for so long shows a deeper problem: regulation can’t fix corruption. And in places where power is scarce, the temptation to steal is high.

Who Wins? Who Loses?

The rationing system has reshaped who can mine in Kazakhstan. Big players with deep pockets-firms backed by foreign investors-can handle the bureaucracy. They hire compliance teams. They buy multiple licenses. They spread their rigs across regions to avoid hitting transaction limits.

Small miners? Not so lucky. Many have left. Others are selling their rigs to pay rent. One operator in Karaganda told reporters he sold his 120 rigs for $180,000-less than half their original value. "I didn’t want to break the law," he said. "But I couldn’t afford to follow it." Meanwhile, the government is pushing a new idea: a 70/30 energy program. Foreign investors would fund new thermal power plants. 70% of the output would go to the national grid. 30% would be reserved for licensed miners. If it passes, it could mean more stable power for everyone-and more room for legal mining.

But even that has risks. If the new plants rely on coal, Kazakhstan’s carbon footprint will grow. And if the 30% allocation isn’t tightly controlled, the same corruption could return.

Is This the Future of Crypto Mining?

Kazakhstan’s model is extreme. But it’s not unique. Russia is building a national registry for mining hardware. France is exploring using idle nuclear plants for Bitcoin mining. Even Texas, once a haven for miners, is now debating capacity limits during summer heatwaves.

The trend is clear: governments are no longer letting crypto miners take what they want. They’re demanding accountability. They want to know where the power comes from. Who’s using it. And who’s paying for it.

Kazakhstan’s system isn’t perfect. It’s slow. It’s expensive. And it still can’t stop every thief. But it’s the most structured attempt yet to turn crypto mining from a wild west into a regulated industry.

For miners, the message is simple: if you want to operate legally, you’ll need more than rigs and electricity. You’ll need lawyers, accountants, and patience. For the rest of the country, it’s a gamble: can the economic benefits of mining outweigh the risk of blackouts?

What’s Next for Kazakhstan’s Mining Rules?

Legislators are already talking about expanding the AIFC platform to include crypto trading for regular users-not just miners. If approved, this could make Kazakhstan one of the first countries to fully integrate crypto into its formal financial system.

But enforcement remains the weak link. Until utility companies are held accountable for insider theft, and until monitoring systems can catch anomalies in real time, the system will always be vulnerable.

For now, the government is betting on technology and transparency. More sensors. Better data. Stricter penalties. And a growing network of licensed miners who have no choice but to play by the rules.

The question isn’t whether mining will survive in Kazakhstan. It’s whether the country can balance its need for revenue with its need for power-and whether the people at home will still have electricity when the lights go out.