In a surprising turn of events, the Kazakhstan government moved ahead to block access to one of the largest cryptocurrency exchanges Coinbase. The authority cited violations of the country’s digital asset laws. The move comes as part of Kazakhstan’s efforts to regulate the circulation of digital assets and to restrict activities of crypto exchanges outside the Astana International Financial Center.
Coinbase to discontinue in Kazakhstan?
The Ministry of Culture and Information of Kazakhstan in compliance with a request from the Ministry of Digital Development, Innovation, and Aerospace Industry acted in order to block Coinbase.
As per reports, the specific violation pertains to paragraph 5 of Article 11 of Kazakhstan’s “On Digital Assets in the Republic of Kazakhstan” law. This legal provision prohibits the issuance and circulation of unsecured digital assets. This also includes the operation of crypto exchanges for such assets with exceptions limited to the Astana International Financial Center.
It is important to note that other major crypto exchanges like Binance, CaspianEx, Biteeu, ATAIX, Upbit, and Bybit, have obtained licenses to operate within Kazakhstan.
According to the authority, the licensing process in the country requires securing a work permit from the Astana Financial Services Regulatory Committee (AFSA) within the Astana International Financial Center. This absence of compliance with these regulatory requirements encouraged the Ministry of Digital Development to request the blocking of Coinbase’s services.
Kazakh’s harsh approach towards crypto?
As reported, the Kazakhstan government earlier temporarily blocked the websites of Interactive Brokers and the New York Mercantile Exchange (NYMEX) alleging identified violations in the process. The main reason behind these restrictions stemmed from multiple identified violations in their activities.
In the case of Interactive Brokers, the website was flagged for signs of a “financial pyramid and other fraudulent transactions. This led to the scrutiny of the firm by the Agency for Regulation and Development of the Financial Market (ARFRD). However, the Financial Monitoring Agency requested the resumption of access to the Interactive Brokers website. This eventually led the Ministry of Information to issue an order for the restoration of the website.
NYMEX website known for its futures trading options on the biggest cryptos like Bitcoin (BTC) and Ethereum (ETH) got blocked due to its operation outside the jurisdiction of the Astana International Financial Center. Meanwhile, the exact reason behind the subsequent restoration of access to NYMEX remains undisclosed.
As the news broke out, the global digital asset market recorded a marginal plunge of 1%. The cumulative market cap stands at around $1.32 trillion. Bitcoin and Ethereum prices are down by almost 2%, at the press time.
