Key Insights
- Kazakhstan has made a bold statement to the rest of the world, after cracking down on over 3,500 platforms.
- The country also shut down 36 illegal exchanges with a combined turnover of more than $120 million.
- A total of 545,000 USDT was recovered and returned to victims, with an additional 120,000 USDT tied to the closed platforms.
- This is similar to a ban on Coinbase that the country implemented earlier in 2023.
This month, Kazakhstan news shows that the country has taken decisive action against illegal crypto activities.
The country’s shift in regulatory approach has seen thousands of unauthorized cryptocurrency exchanges shut down, and new rules introduced.
So far, the Central Asian nation is positioning itself as a strict but forward-looking player in the crypto space.
Here are all the details.
Thousands of Platforms Blocked
Kazakhstan’s National Security Committee collaborated with the Ministry of Culture and Information and the Financial Monitoring Agency (FMA) in 2024.
These two reportedly blocked access to over 3,500 illegal online cryptocurrency exchanges.
Authorities also targeted offline operations and shut down 36 illegal exchanges with a combined turnover of more than $120 million.
These closures also involved freezing 4.8 million USDT and dismantling two crypto pyramid schemes.
In total, 545,000 USDT was recovered and returned to victims with an additional 120,000 USDT tied to the schemes frozen.
Strengthening Oversight and International Cooperation
Kazakhstan’s Financial Monitoring Agency reiterated its commitment to keeping crypto regulated.
It also restated its mission to prevent the misuse of Bitcoin exchanges for criminal purposes.
In a statement to local media houses, the agency revealed that it has now made amendments to legislation.
These amendments impose stricter laws for digital asset providers for any rule-breaking related to money laundering.
The government has greatly improved its verification processes for crypto transactions in financial organizations.
The country is also collaborating with international partners to improve their tracking of crypto transactions, even across borders.
High-Profile Action Against Coinbase
Kazakhstan’s resolve to enforce its crypto laws was especially evident in 2023, when the country made the decision to block access to Coinbase.
Authorities accused the platform of violating the nation’s digital asset laws, blocking it and sending a message to other international players in the crypto space.
While the crackdown has been robust, Kazakhstan is also on a mission to provide a safe and regulated crypto environment.
Licensed exchanges (like Binance and Bybit) now operate under the oversight of the Astana Financial Services Authority (AFSA).
AFSA in turn, operates within the Astana International Financial Centre (AIFC), which serves as a dedicated financial zone for digital asset companies.
However, despite this strict wave of regulation, Kazakhstan’s leadership is open to expanding access to digital assets.
In 2024, the head of Kazakhstan’s National Bank, Timur Sulerimenov showed interest in allowing citizens to use exchanges, even beyond the AIFC zone.
A New Tenge CBDC In Kazakhstan.
Asides from its crypto regulation moves, Kazakhstan is exploring the possibility of a CBDC, known as the digital tenge.
This digitized form of the nation’s currency is aimed at modernizing the nation’s financial infrastructure.
The National Bank of Kazakhstan also highlighted the digital-Tenge’s ability to improve systems like value-added tax (also known as VAT) collection.
Kazakhstan’s dual approach to regulation shows a clear commitment to balancing security and innovation as two sides of a whole.
Its clampdown on illegal activities, while welcoming currency digitization is likely to bear fruit and create a safer crypto environment for its citizens.
