As per new bills enacted by Kazakhstan’s national parliament’s upper house today, crypto business owners in the country may soon be subject to Anti-Money Laundering (AML) rules and regs, according to local news station Vlast.
The new law broadens the scope of the country’s financial surveillance system to include virtual currency service providers.
Senator Olga Perepechina, according to Vlast, stated that Kazakhstan’s economic surveillance present system does not protect corporate structures that manage virtual currencies, organise trade, or provide services for the transformation of cryptocurrencies into cash, tangible products, and other assets.
In addition, the proposed law would create a legal institution for public officials. When a company launches a cryptocurrency trading provider or issues digital content, it must notify Kazakhstan’s Ministry of Digital Development, Innovation, and Aerospace Industry. The establishment will be in full control of carrying out a threat evaluation and ensuring that Know Your Customer and Anti-Money Laundering regulatory requirements are followed.
The senate candidate alerted that the lack of regulation allows laundering and terrorist financing offences to spread quickly, as well as the growth of the underground market. She warned that criminal groups, including terrorist groups, are urged to use virtual currencies and digital methods in their settlements.
The proposal, however, has yet to be approved by the country’s president, Kassym-Jomart Tokayev. Tokayev called for the “immediate” regulatory oversight of yet another cryptocurrency activity, Bitcoin mining, last month, citing the country’s power deficit. The Central Asian country, that has some of the world’s cheapest power generation, has emerged as a Cryptocurrency mining center point in the midst of a Chinese crackdown.
Kazakhstan anticipates that virtual currency extraction will contribute $1.5 billion to the country’s economic system within the next five years. The country currently has the world’s second highest mining hash rate, trailing only the United States.