Kazakhstan: In two minds about cryptocurrencies
ALMATY (TCA) — The emerging cryptocurrency business has both critics and new followers in Kazakhstan, while authorities warn the population of risks of investing in cryptocurrencies. We are republishing this article on the issue, written by Chris Rickleton, originally published by Eurasianet: The cryptocurrency business can be a flash in the pan. In Kazakhstan, few know that better than Zhomart Mametkarim. Late last year, with Bitcoin surging in value, he opened a cafe in the business capital, Almaty, and branded it a Crypto Hub. The establishment was intended as a celebration of all things cryptocurrency-related. Items on the menu included bit burgers and a take on beshbarmak, Kazakhstan’s beloved noodle and meat dish, which the cafe recast as bit barmak. Customers could even pay in the virtual currency, although few ever actually did. Mametkarim and his partners regularly hosted talks on cryptocurrencies and their underlying blockchain technology at the cafe. “People are mostly interested in how to earn money from trading,” Mametkarim told Eurasianet. While the menu was a bit of fun, the real aim of the venue was “to provide a space for the community interested in such things.” When Eurasianet met Mametkarim earlier this year, cryptocurrencies were very much on the up. Bitcoin, the most famous cryptocurrency, had just soared in value by 20 percent in less than a week to pass $10,000 for the first time after a precipitous slump from its all-time high of $19,783 in December. Bitcoin has had a rocky ride since then and is currently worth around $8,000 per unit. Other less prominent digital currencies have had a similarly torrid time. When Eurasianet dropped by Mametkarim’s cafe in June, it had changed hands and been rebranded. Mametkarim said he would hold crypto-related events at his office instead. The story of the Crypto Hub brand feels like a salutary warning against overexuberance. Kazakhstan is adopting an accordingly cautious stance. “In Kazakhstan, the National Bank is very conservative about this issue,” Daniyar Akishev, the young but circumspect chairman of the National Bank, said in March. “We want to prohibit the purchase and sale of the national currency for cryptocurrency. We want to prohibit the activity of exchanges on this segment and any kinds of mining.” Akishev was tilting at windmills on the trading front, since that is an area of business it is all but impossible to regulate entirely. But it was his remarks on mining that got some people’s hackles up. Mining, the series of electricity-hungry processes whereby networks of computers verify and record cryptocurrency transactions, is seen by some as a promising sector for Kazakhstan. “What is mining? Mining is data processing. Mining is calculation. Which of these does he want to ban?” asked Leonid Muravyev, vice president of the Blockchain and Crypto Technology Association of Kazakhstan, a lobby group based in Almaty. Kazakhstan is in pole position to exploit the global data-mining boom, according to Muravyev, whose association counts one of the largest cloud mining companies in the world, Genesis Mining, among...
