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Kazakhstan Takes Bold Move Against Unregistered Exchanges

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In a bid to regulate the cryptocurrency market and safeguard its citizens, Kazakhstan’s Financial Monitoring Agency (FMA) has taken decisive action against unlicensed crypto exchanges in 2023. With the implementation of the Digital Assets Law earlier in the year, the FMA has blocked access to 980 illegal platforms and initiated investigations into illegal exchange operations and money laundering. 

This article explores the significance of these actions and sheds light on the approved exchanges permitted to operate within the country.

The Crackdown on Unlicensed Exchanges 

Kazakhstan’s Financial Monitoring Agency made a bold move in 2023 by denying access to nearly a thousand unlicensed crypto exchanges. These platforms were operating without proper registration, violating the recently enacted Digital Assets Law. The FMA’s actions demonstrate the government’s commitment to preventing unauthorized cryptocurrency trading and ensuring compliance with regulatory standards.

Investigations into Illegal Operations 

Alongside blocking unlicensed exchanges, the Financial Monitoring Agency has launched nine investigations into illegal exchange operations and money laundering. These investigations aim to identify and prosecute individuals or organizations involved in unauthorized trading activities that pose a risk to the integrity of the financial system.

The Digital Assets Law and Licensing Process

To regulate the cryptocurrency market effectively, Kazakhstan introduced the Digital Assets Law in February 2023. This law prohibits the creation and trading of digital currencies and cryptocurrency exchange activities without obtaining a national license. The Astana International Financial Center (AIFC), a special economic zone, is responsible for granting preliminary approval for operations.

Impact on Major International Platforms

The list of unlicensed exchanges blocked by the FMA includes prominent international platforms. In November, it was revealed that Kazakh citizens were unable to access the Coinbase website due to an order from the Ministry of Culture and Information. 

The Ministry attributed the block to a request from the Ministry of Digital Development, which accused Coinbase of violating the Digital Assets Law. This incident highlights the government’s determination to enforce regulations, regardless of the platform’s global reputation.

Approved Exchanges Operating in Kazakhstan

Despite the crackdown, several exchanges have obtained approval to operate within Kazakhstan. Currently, Binance, Bybit, CaspianEx, Biteeu, ATAIX, Upbit, and Xignal&MT have been granted licenses to provide crypto services. These approved exchanges comply with the country’s regulatory framework and operate within the legal boundaries set by the Digital Assets Law. Their presence offers Kazakh citizens a secure and regulated environment for engaging in cryptocurrency trading.

Conclusion 

Kazakhstan’s actions against unlicensed crypto exchanges in 2023 demonstrate its commitment to regulating the cryptocurrency market and protecting its citizens from potential risks. By enforcing the Digital Assets Law and granting licenses to approved exchanges, the country aims to create a secure and transparent environment for cryptocurrency trading.

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