Samson Mow: Bitcoin mining will become a strategic investment sector for many nation-states

Source: Daily Planet

Digital assets are becoming so attractive that they have caught the attention of some nation-states. For example, the government of Kazakhstan is now one of the major digital miners, which is surprising to many considering that most other governments have decided to remain lukewarm towards digital assets. Blockstream CEO Samson Mow said that Bitcoin mining could be a very viable strategic investment for the government. Samson also sent out an attractive tweet on Twitter for this purpose.

This is a big shift

Kazakhstan’s decision to venture into large-scale, government-sponsored Bitcoin mining is a dramatic shift from its early entry into the digital asset market. In 2018, the country’s central bank (National Bank of Kazakhstan) attempted to draft a policy that would have defined digital assets and related activities as illegal in the country.

A few months later, the policy was repealed in favor of a friendlier approach to digital assets. The Kazakh government subsequently launched a project that has spawned multiple Bitcoin mining farms. Currently, about $190 million has been invested in the project.

Huge expansion

Now, the government is investing more money to expand its Bitcoin mining operations. The current Minister of Digital Development, Bagdat Mussin, recently announced plans to inject more than $700 million into Bitcoin mining operations. The country already operates 13 mining farms, with four more expected to be operational soon.

Kazakhstan already has more than 10 large Bitcoin mining farms in operation, contributing 6% of the global hashrate on the Bitcoin network. If the country invests more financial support in its already successful mining projects, it will be expected to gain a larger share. However, the country still lags behind other larger mining regions, such as China, the United States, and Russia.

Cheap power

It is worth noting that one of the main reasons that makes Kazakhstan great for Bitcoin mining is that it can easily get very cheap electricity from its coal reserves. In fact, some miners from China have already moved their mining operations to Kazakhstan to take advantage of its cheap electricity.

Kazakhstan’s entry into Bitcoin mining as a government-backed project puts the spotlight on the wider global impact the move could have. If more governments begin mining digital assets, it will only be a matter of time before digital assets, especially Bitcoin, gain mass adoption.

Finally, although Bitcoin experienced another halving event in May this year, it is still an extremely attractive digital asset. The government has invested huge amounts of money to support Bitcoin mining, which shows that its value is indeed extraordinary.