Executive Summary
On April 17, 2026, Uzbekistan’s president approved decree PQ‑143, creating the Besqala Mining Valley in the autonomous region of Karakalpakstan. The new hub will centralise licensing, impose a 1 % revenue fee on participating miners, and channel those funds toward regional budget goals for 2035. The move signals the government’s intent to formalise the country’s cryptocurrency mining sector while tying growth to broader diversification and clean‑energy objectives.
What Happened
The decree, signed by the president, formally establishes the Besqala Mining Valley as a specialised district for cryptocurrency mining. Management of licences will fall to the National Agency for Project Planning (NAPP), which will evaluate applications and enforce compliance. Mining operators that secure a licence must contribute a fee equal to one percent of their revenue, with the proceeds earmarked for the region’s long‑term fiscal plan.
By design, the hub aims to attract both domestic and foreign investment, offering a clear regulatory framework that was previously fragmented across Uzbekistan’s jurisdictions. The government highlighted the district’s alignment with national strategies to diversify the economy and expand renewable‑energy capacity.
Background / Context
Uzbekistan has emerged as a low‑cost electricity provider for crypto mining, thanks to abundant natural gas and a growing renewable‑energy sector. However, the rapid expansion of unregulated farms raised concerns about energy consumption, environmental impact, and fiscal leakage. Prior to the decree, miners operated under a patchwork of local permits, creating uncertainty for investors and limiting the state’s ability to capture economic benefits.
President Shavkat Mirziyoyev’s administration has prioritised economic diversification away from traditional cotton and hydrocarbon exports. The introduction of a dedicated mining district dovetails with the country’s 2035 renewable‑energy targets, signalling a shift toward a regulated, sustainable mining ecosystem.
Reactions
Industry observers welcomed the clarity the decree brings. Representatives from several mining firms expressed optimism that the licensing process, overseen by NAPP, will streamline operations and reduce bureaucratic friction. The regional government in Karakalpakstan noted that the 1 % revenue fee will bolster local infrastructure projects, aligning with the 2035 budget framework.
Environmental NGOs, while acknowledging the government’s renewable‑energy emphasis, called for transparent monitoring to ensure that mining activities stay within the country’s carbon‑reduction commitments. International analysts pointed out that the hub could position Uzbekistan as a competitive alternative to established mining hubs in North America and Europe.
What It Means
The Besqala Mining Valley creates a single point of contact for miners seeking legal operation status, reducing the administrative overhead that previously deterred larger investors. By tying the revenue fee to regional budget goals, the government ensures that the sector’s growth contributes directly to public services and infrastructure development.
From a strategic standpoint, the decree reinforces Uzbekistan’s ambition to become a crypto‑friendly jurisdiction without sacrificing its renewable‑energy agenda. The policy could attract firms that prioritise sustainability, potentially fostering partnerships with renewable‑energy providers and technology providers focused on energy‑efficient mining hardware.
In the broader geopolitical landscape, the move may encourage other Central Asian nations to adopt similar frameworks, reshaping the regional mining map and potentially drawing capital away from jurisdictions with less regulatory certainty.
What Happens Next
NAPP is slated to open its first round of licensing applications within the next month, with guidelines expected to be published on the agency’s website. Prospective operators will need to submit detailed energy‑usage plans, proof of compliance with environmental standards, and financial projections that accommodate the 1 % fee.
Stakeholders anticipate that the initial licensing phase will set the tone for the valley’s operational standards. Follow‑up legislation may further define tax incentives, renewable‑energy procurement requirements, and reporting mechanisms to ensure alignment with the 2035 budget and sustainability targets.