Kazakhstan passes new law to regulate digital currency firms

Kazakhstan has passed a new law that seeks to regulate digital currency service providers. The new law puts the burgeoning industry under the Digital Development Ministry and requires all service providers to conduct anti-money laundering checks.

The new law was passed by the upper house of the Kazakh parliament, local outlet Vlast reports. According to Olga Perepechina, one of the senators pushing for the bill, virtual asset service providers (VASPs) in Kazakhstan have remained unregulated for long enough. This lack of oversight has provided fertile ground for criminals to exploit, she believes.

Perepechina said, “Today, persons issuing and organizing trading of digital assets, as well as providing services for the exchange of digital assets for cash, valuables and other property, are outside financial monitoring, which contributes to the spread of crimes in the field of money laundering and terrorist financing, including the shadow economy.”

“It stimulates malefactors, including terrorists, to use electronic assets in mutual settlements,” she added.

The Ministry of Digital Development, Innovation and Aerospace Industry will be given oversight authority over the VASPs. It will ensure that all the AML and CFT regulations are met and conduct a risk assessment of all the VASPs before they are allowed to serve the Kazakh public.

The new law also extended to other financial services, calling for the reduction of the threshold at which financial entities are required to report a transaction from 3 million tenge ($6,990) to 1 million tenge ($2,330). It will also see those close to public officials, including their family members come under more scrutiny.

The bill is at the desk of the country’s president, Kassym-Jomart Tokayev, for his signature before it becomes official law.

This law is the latest measure by the Kazakh government to regulate the digital currency industry. As CoinGeek reported two weeks ago, the country is seeking to limit miners to 100MW of power as shortages start to bite. Kazakhstan is the world’s second-largest home to block reward miners after the United States.

Last week, the government announced that it sought to limit digital currency investment to 10% of annual income. Traders who provide their financial records to authorities are allowed to invest up to $100,000 a year.

Watch: CoinGeek New York presentation, Increasing Footprints of BSV Blockchain in Middle East & South Asia

Source: Read Full Article