Uzbekistan Implements Strict Regulations on Crypto Mining

As a result of the country’s crypto market regulator approving a framework for licensing crypto mining operations, the mining of cryptocurrencies in Uzbekistan is undergoing significant changes.

The National Agency for Prospective Projects (NAPP) of Uzbekistan issued a decree restricting cryptocurrency mining to legal entities only.

In addition to prohibiting individual mining operations, the NAPP has mandated that only solar energy can be used to mine cryptocurrencies such as Bitcoin.

However, the legislation permits miners to use the unified power system of Uzbekistan in certain circumstances. The document does not specify which cases are intended.

The cryptocurrency regulator in Uzbekistan demanded, among other things, that companies install mining equipment in a dedicated chamber and only mine cryptocurrency at the registered address.

The regulations also stipulate that crypto mining companies must pay mining fees to regulators on time and in full. In addition, the NAPP prohibits miners from mining “anonymous” cryptocurrencies, or those based on anonymity and transaction concealment.

The authority was referring to privacy-focused cryptocurrencies like Monero, which enable users to obfuscate network transactions.

“All mining operations and services are only possible after obtaining a permitting document and license in the prescribed manner,” the NAPP wrote, adding that it is unclear whether its latest crypto-mining document is a final decree establishing a framework for mining in Uzbekistan.

“The agency also asks all citizens to act within the framework of the law and refrain from attempting to organize activities in the field of circulation of crypto-assets without obtaining the appropriate license.”

In recent years, the local government has repeatedly issued identical documents prohibiting individual miners from operating in Uzbekistan.

In April 2022, President Shavkat Mirziyoyev of Uzbekistan issued a decree reiterating that locals are not permitted to pay with cryptocurrencies or mine digital currencies.