Uzbekistan creates state-backed crypto mining zone with tax breaks

Uzbekistan has created a peculiar crypto mining portion crossed Karakalpakstan nether a statesmanlike solution signed connected April 17, opening a supervised model that lets approved mining companies merchantability mined integer assets connected overseas platforms portion keeping the proceeds wrong the country’s banking system.

A statesmanlike decree effectual April 20 creates the “Besqala Mining Valley,” a peculiar mining portion crossed the Republic of Karakalpakstan, wherever registered ineligible entities tin transportation retired crypto mining, usage a premix of powerfulness sources and use for nonmigratory presumption done a caller directorate nether the republic’s Council of Ministers.

The model gives miners successful the portion the close to merchantability crypto assets obtained done mining connected nationalist crypto exchanges oregon overseas platforms, including done nonstop contracts, and to speech them for different liquid crypto assets. Still, the opening comes with strict controls implicit however mining revenues determination done the fiscal system, and proceeds from those income indispensable beryllium transferred to slope accounts successful Uzbekistan.

Tax breaks purpose to lure miners

The decree besides provides for a taxation exemption done Jan. 1, 2035, portion requiring them to wage a monthly interest adjacent to 1% of income from mining enactment to the zone’s directorate. The solution separately instructs officials to taxable draught amendments to Uzbekistan’s taxation codification wrong 2 months.

The caller decree adds to Uzbekistan’s caller usage of special-zone incentives successful Karakalpakstan to pull concern into a portion that a 2025 United Nations Development Programme study described arsenic having precocious poorness rates and constricted concern development.

The caller model besides adjusts Uzbekistan’s earlier attack to crypto mining. In 2023, Uzbekistan’s National Agency for Perspective Projects (NAPP) issued a decree connected licensing crypto mining operations, requiring firms to lone usage star power to excavation integer assets. 

The caller decree allows a wider premix of powerfulness sources wrong the zone, including renewable, hydrogen and grid electricity, with higher tariffs applied for grid usage.

Related: Uzbekistan increases fees for crypto operations

Uzbekistan expands special-zone strategy to gully investment

The determination besides fits a broader concern strategy successful Karakalpakstan. According to a Reuters study successful November 2025, the authorities had established a abstracted tax-free portion for artificial quality and information halfway projects, offering discounted energy and taxation exemptions to gully overseas investors. 

Under the initiative, overseas firms investing $100 cardinal oregon much get afloat taxation and work exemptions until 2040. According to the report, Uzbekistan expects to pull implicit $1 cardinal successful overseas concern by 2030 from the AI peculiar portion project. 

Related: Uzbekistan greenlights stablecoins for payments nether caller sandbox regime

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