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Kazakhstan May Allow Crypto Exchanges To Open Bank Accounts

Kazakhstan May Allow Crypto Exchanges To Open Bank Accounts

The Kazakhstani government has approved legislation that will regulate interactions between local crypto exchanges and financial institutions, even allowing registered exchanges to have bank accounts in the country. 

Crypto Exchanges To Partner With Local Banks 

As a part of the pilot project to develop Kazakhstan into a crypto hub, crypto exchanges registered at the Astana International Financial Center (AIFC) have been granted official approval to avail of banking services from the second-tier banks of the country. The legislation was passed by a group consisting of representatives from the Ministry of Digital Development, the central bank of Kazakhstan, financial regulators, and members of the financial and digital asset sectors. The pilot project, which will run till the end of the year, will allow crypto exchanges to handle and operate digital assets in partnership with the second-tier banks of the country. 

Successful Pilot Could Lead To New Legislation

The pilot project will also regulate digital currency trading to protect both retailers and professional investors. The central government is also planning to watch the outcome of the pilot project closely. If the implementation is successful, the government intends to modify the rules governing the AIFC. As of now, all fintech activities in Kazakhstan, including exchanges applying for a license, are being thoroughly supervised by the AIFC Financial Services Regulatory Committee. However, AFSA Director Nurkhat Kushimov has stated that the goal is to establish an environment that would facilitate the operations of trustworthy and stable companies. 

Authorities Looking Beyond Mining

The launch of the pilot program to test crypto exchanges comes soon after the Chairman of the National Bank of Kazakhstan, Galymzhan Pirmatov, announced in a press conference that the authorities have taken the time to study the crypto industry closely. Recently, Binance CEO Changpeng Zhao (CZ) had also visited the country to meet with President and discuss the Kazakhstani crypto strategy. 

Kazhakstan had been one of the countries that welcomed Chinese BTC miners with open arms after the countrywide crypto ban in China was imposed last year. In fact, the country benefited the most from the Chinese miner exodus. The country’s energy supply struggled under the burden of the increased mining activities, and the government even toyed with the idea of adopting nuclear power to solve the crisis. 

Kazakhstan Eager To Grow As Crypto Hub

However, it is clear that the country does not want to limit its crypto industry to just mining operations. Digital Development Minister Bagdat Musin stated that a well-rounded crypto industry needs to develop in the country, to ensure that the cryptos mined using the country’s energy are traded on local exchanges, and the income stays within the country. 

He said, 

“It is like other industries, which can and should work for the benefit of our economy. We must make money on crypto exchange — this is the next level of development of financial technologies.”

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.