Companies providing trading services for digital assets will be able to open accounts with banks in Kazakhstan, local media reported, quoting the country’s crypto industry association. The service should allow Kazakhs to legally invest in cryptocurrencies and cash out their profits.
Crypto Exchanges in Kazakhstan to Be Offered Banking Services
Kazakh banks will be permitted to open accounts for cryptocurrency exchanges registered at the Astana International Financial Center (AIFC), Kazakhstan’s National Association of Blockchain and Data Center Industry announced, quoted by local news portal Habar 24. The move is part of а pilot project with second-tier banks that’s expected to continue for one year.
Potential crypto investors will be required to have an account with a participating banking institution to trade on any of the exchanges. This would allow them to transfer fiat money, buy digital coins and carry out various other operations on Kazakhstan’s crypto trading market. Income from profitable investments can then be deposited back to personal accounts.
The government in Nur-Sultan is planning to use the project to conduct an assessment of the risks and benefits of digital assets. The circulation of cryptocurrencies in the Central Asian republic is still prohibited but industry observers hope the restrictions can be loosened or even lifted following the successful completion of the project.
Banks in Kazakhstan to Benefit From Crypto Turnover
Experts point to several reasons for a revision of the official policy towards decentralized digital money. Sergey Putra, who coordinates relations with the government at Kazakhstan’s blockchain association, noted that the global crypto economy represents a fairly large volume of finance, billions of dollars of daily turnover. He further commented:
Even if Kazakhstan takes a fraction of a percent, even one percent of this turnover, this is serious money that will come to Kazakhstan in the form of investments and that will remain here in the form of taxes, jobs and salaries. This is a very large industry, which Kazakhstan is still bypassing.
In the past couple of years, Kazakhstan has become a magnet for crypto miners, especially in the midst of an ongoing crackdown in China. With its low-cost energy and generally positive attitude towards the sector, the country has increased its importance as a coin minting destination, currently accounting for 6 – 8% of global mining volume. The local banking system would benefit from processing financial transactions for the growing industry.
Last but not least, authorities hope the project will help to prevent fraud in the crypto space by facilitating safe cryptocurrency exchange for local residents. Cases in which Kazakhs are lured into fake investment schemes and losing crypto or fiat funds have been mounting, the report notes.
What do you expect from the project to allow banks in Kazakhstan to work with cryptocurrency exchanges? Let us know in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.