Kyrgyzstan has allegedly introduced anew regulatory infrastructure that is designed to introduce the legal status to crypto exchanges operating in the country. The government is now moving forward to crypto adoption by introducing a national regulatory network for crypto trading platforms.
The State Service for Regulation and Supervision of Financial Markets (Gosfinnadzor) Kyrgyzstan, a regulatory agency that operates under the Ministry of Economy and Finance, has created a draft provision for regulating cryptocurrency exchanges, as reported by local news agency 24.kg reported on August 25.
The Kyrgyz Republic is thus moving forward to crypto adoption by introducing a national regulatory infrastructure for crypto trading firms.
These newly proposed rules and regulations allegedly aim to establish the legal status of cryptocurrency exchanges that are operating in the country. Responsibilities, functions, and compliance obligations include essential registration with the unified state register. The rules also need crypto exchange service providers to guarantee that measures to counter illegal activities like terrorism financing and money laundering are put in place.
Gosfinnadzor supposedly said that the new framework might reduce the existing risks and help in the creation of innovative technologies and the formation of a digital economy in the Kyrgyz Republic. These rules would also support the introduction and thriving of a new financial ecosystem that will feature the participation from a wider range of players like qualified investors and businesses, as explained by the authority.
The new infrastructure is expected to increase investor awareness of cryptocurrency exchange operations and generate new income sources for the national budget.
As previously noted, Kyrgyzstan has sought to regulate the budding crypto sector many times in recent years, initiating some regulations that target the crypto mining space and crypto exchanges. In February 2021, the country’s central bank was planning to set up a licensing regime for crypto exchanges in a move that aims to protect the local investors.