Kazakhstan Offers Three-Year Tax Break for Crypto Holders

Kazakhstan's President Kassym-Jomart Tokayev has signed a decree that grants crypto holders in the country a three-year tax break on digital-asset gains. The move is expected to bring an estimated 1 million crypto wallets back into licensed domestic exchanges from foreign platforms.

The decree, drafted by the Ministry of Artificial Intelligence and Digital Development, the National Bank of Kazakhstan, and the Astana International Financial Centre (AIFC), will exempt private investors from personal income tax on gains from digital-asset transactions for three years. Assets linked to fraud, money laundering, or unlicensed crypto services are excluded from this exemption.

Kazakhstan's Vice Minister of AI and Digital Development, Gizzat Baitursynov, is working on a simplified tax regime that will be implemented after the three-year window and plans to cancel tax audits covering investors' previous three years. The AIFC notes that Kazakh citizens hold around 1 million crypto wallets, nearly four times the number of users registered on authorized local exchanges as of March.

The decree also addresses Kazakhstan's electricity problem, which was triggered by an influx of miners after China banned Bitcoin mining in 2021. To keep new mining off the public grid, oil and gas fields will be allowed to divert associated petroleum gas into autonomous generators for mining. A parallel '70/30' model gives data centers and miners direct access to up to 70% of new capacity built through infrastructure upgrades.

Nurkhat Kushimov, general manager of Binance Kazakhstan, hailed the tax break as the decree's most important measure, saying it makes licensed jurisdictions more attractive. However, Bakhytzhan Kenzhebayev, chairman of Kazakhstan's Association of Fintech, AI and Crypto Industry, warned that loose legal definitions could invite abuse.