Saturday, November 27

Kazakhstan to control activities of bitcoin miners and operators


Kazakhstan, the second largest country with bitcoin (BTC) mining capacity, is making progress in regulating the emerging market. The Senate of that country approved a law that has among its articles a framework for the operation of exchanges and other companies, under the guise of money laundering and other financial crimes.

According to the local media Sputnik.kz, it is the Law of Amendments and Additions, applied to various laws of that country to counteract the money laundering related to terrorist financing.

The legislation, which is now awaiting the signature of the country’s president, Ashraf Ghani, for its enactment; proposes to regulate the operation of virtual asset service providers, through which, they excuse, these crimes can be committed.

For the deputy Olga Perepechina, defender of the project, the people who issue, organize the trade of digital assets and exchange them for fiat money, securities and other properties, are out of financial monitoring, leading to possible money laundering and terrorist financing. “It encourages criminals, including terrorists, to use electronic assets in mutual agreements,” he warned.

Senate of Kazakhstan. / Source: Wikipedia.

Financial Tracking Subjects and More

The law proposes to classify those who operate with cryptocurrencies (including merchants and miners) within that country as “Subjects of financial monitoring”, being obliged to notify the start or end of activities to an authorized body, previously established: the Ministry of Digital Development, Aerospace Industry and Defense.

For the deputy Perepechina, the reason for this regulation is to want to guarantee “cybersecurity”, reduce the risks of money laundering and increase the effectiveness of the national system against those crimes.

This, in addition to balancing the law approved in June 2020, related to the regulation of digital technologies, that allows the issuance and circulation of digital assets in Kazakhstan.

Was this already coming?

Since July, when China rammed the bitcoin and other cryptocurrency mining industry, Kazakhstan has become a paradise for miners who, due to circumstances, had to flee their country.

In fact, currently Kazakhstan is the second country in the world with the highest mining activity, with 18% of computing power, being only behind the United States, which comprises 35%, as reported by CriptoNoticias.

That, probably, led to the law approved by the Senate, and surely in what happened a day before: the imposition of a cryptocurrency purchase limit.

It was a fact. On November 3, the Financial Services Authority of Astana, the country’s capital (AFSA), established limit for retail investors who want to buy cryptocurrencies in local exchanges registered in that entity, in accordance with a law also amended and that came into force last October, indicates the local media Kapital.kz.

The AFSA established a limit for retail investors who want to buy cryptocurrencies / Source: Astana Times.

According to the government entity, the general limit for the purchase of cryptocurrencies for retail investors is USD 1,000, without prior confirmation of income and assets for a month.

To buy more than a thousand dollars, such documents are required, but only 10% of annual income can be acquired or 5% of the value of all assets, but no more than USD 100,000.

“Limits are established for the protection of the interests of retail investors, since transactions with digital assets are associated with high risks, contributions to the total loss of invested capital,” said AFSA.

But not everything is negative. According to the media, the roadmap for the cryptocurrency market development, and that they are already working to implement it, something that may occur at the end of next year.

«The map describes stages of the plan for the development of the crypto industry in the country. The start of the pilot project, related to the launch of the cryptocurrency exchange, is scheduled for the end of 2021. By the end of 2022, the cryptocurrencies will be able to operate in trial mode. At the end of the pilot project, if necessary, changes will be made to the national legislation, ”said AFSA.



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