Significant changes are afoot in Uzbekistan's cryptocurrency mining sector as the nation's cryptocurrency market regulator greenlights a licensing framework for crypto mining operations.
Uzbekistan's National Agency for Prospective Projects (NAPP) has issued a decree outlining the licensing process for cryptocurrency mining operations, with a key restriction being that only legal entities are eligible to participate. Individual miners are prohibited from engaging in such activities. Moreover, NAPP has mandated that companies involved in crypto mining use solar energy as the exclusive power source for their operations, particularly for mining popular cryptocurrencies like Bitcoin (BTC). However, miners may still have the option to utilize Uzbekistan's unified electricity system under certain conditions, although the specifics of these circumstances have not been detailed in the legislation.
The licensing framework introduces various requirements for cryptocurrency mining companies, such as the obligation to establish a dedicated space for installing mining equipment and restricting mining activities to registered addresses. Additionally, crypto miners must promptly and completely fulfill the mining fees determined by regulators. Furthermore, NAPP has barred miners from participating in the mining of anonymous cryptocurrencies, referring to those that facilitate concealed and anonymous transactions. This primarily includes privacy-oriented cryptocurrencies like Monero (XMR), which permit users to obscure their online transactions.
The document emphasized that all mining activities and services can only be conducted after obtaining the necessary permission documents and permits through the prescribed channels. NAPP also called upon all citizens to act in accordance with the legal framework and to avoid any attempts to engage in cryptocurrency asset-related activities without obtaining the appropriate licenses.
However, it remains unclear whether this latest document from NAPP represents the final decree establishing a comprehensive regulatory framework for cryptocurrency mining in Uzbekistan. In recent years, the local government has issued multiple similar documents that restrict the involvement of individual miners in Uzbekistan's cryptocurrency sector. In April 2022, Uzbek President Shavkat Mirziyoyev signed a decree reiterating the prohibition on the use of cryptocurrencies for payment or mining by local residents.
