- Legislators in Kazakhstan have enacted a bill requiring crypto platforms to be subject to financial surveillance
- Anti-Money Laundering (AML) measures for crypto firms in Kazakhstan were passed by the upper chamber of the country’s national parliament on Monday, according to local news site Vlast.
Anti-Money Laundering Legislation
In the wake of the new legislation, crypto service providers will be subject to the country’s financial surveillance system. In addition, the proposed law would create a legal institution for public officials to be held accountable for their actions. For example, the Ministry of Digital Development, Innovation, and Aerospace Industry in Kazakhstan must be notified when a company establishes a cryptocurrency trading service or issues digital assets. Furthermore, as part of a risk assessment, the institution will ensure that Know Your Customer, and Anti-Money Laundering requirements are followed.
Kazakhstan’s financial monitoring system does not presently include legal firms that manage digital assets, arrange a trade or provide services for the conversion of cryptocurrencies into cash, physical products, and other property, according to Senator Olga Perepechina. The Senator expressed concern that the absence of regulation allowed money laundering and terrorism funding to flourish and increase rapidly. As a result, there is a strong incentive for thieves and terrorists to use digital assets and electronic technologies, she said.
Crypto Mining Is Expected To Yield Huge Earnings
However, Kassym-Jomart Tokayev, the country’s president, has yet to sign off on the plan. President Dmitry Medvedev has already advocated for the immediate control of Bitcoin mining in light of the country’s power crisis. As a result, Chinese authorities have upped their efforts to clamp down on Bitcoin mining in the Central Asian country, which has some of the world’s cheapest power. By 2020, Kazakhstan expects cryptocurrency mining to bring in at least $1.5 billion to the country’s coffers. After the United States, China now holds the world’s second-highest mining hash rate.
Kazakhstan’s Study On Cryptocurrency
According to a study conducted by Kazakhstan’s Data Center Industry and Blockchain Association, cryptocurrency mining is expected to produce $1.5 billion in revenue for Kazakhstan over the next five years (NABDC). Currently, digital currency mining provides over $230 million in revenue for the country’s enterprises. According to kapital. kz, the NABDC’s president, Alan Dordzhiev, said that the economic effect of mining-related industries on Kazakhstan totals 98 billion tenges. Taking “gray” miners into account, we may safely quadruple this figure.
A “gray miner” is someone who operates their cryptocurrency mining operation beyond the reach of the law. The organization has called for more control to combat illegal mining and prevent a power shortage. Dordzhiev estimates that the country’s grey area miners use more than 500 megawatts of electricity. Kazakhstan’s Electricity Ministry presented a draft regulation earlier this month limiting the amount of energy consumed by cryptocurrency mining operations.