Kazakhstan has become one of the leading cryptocurrency hubs globally. After the Bitcoin ban last year, the country’s crypto-economy expanded after becoming an ideal location for miners leaving China.
The Kazakhstan government has launched a pilot phase to encourage selected local banks to work with licensed cryptocurrency exchanges.
Kazakhstan asks exchanges to work with banks
The Kazakh government has passed guidelines that will steer a pilot program that will promote the cooperation between some of the leading financial institutions and cryptocurrency exchanges licensed in the country.
The announcement said cryptocurrency exchanges licensed by the Financial Services Regulatory Commission could open bank accounts and seek financial services from second-tier banks in Kazakhstan.
The pilot phase was created by a special working group comprising representatives from government agencies. The group comprised some of Kazakhstan’s central bank representatives, the Ministry of Digital Development, and several agencies and associations representing the financial sector.
The pilot program will run until the end of the year. If it is successful, the country will alter the existing regulatory framework and create a robust one that fosters the growth of the local cryptocurrency sector.
The Kazakh government has actively fostered a friendly regulatory framework for the cryptocurrency sector. The current pilot program stems from plans made in 2021. At the time, the government said that the program would run for one year and allow the government to conduct a cost-benefit analysis of the cryptocurrency market.
Exploring the cryptocurrency sector
The partnership between the banking sector and the digital asset sector has been part of the efforts made by the Kazakh government to attract more cryptocurrency businesses. The country has so far attracted Bitcoin miners, but it is now exploring other areas such as cryptocurrency mining.
The Minister of Digital Development in Kazakhstan, Bagdat Musin, said that “the cryptocurrency industry is not only mining but also includes cryptocurrency, digital currency, digital wallets, and other blockchain technologies. This is an industry that, like other industries, can work for the good of the country and benefit our economy.”
Kazakhstan currently supports cryptocurrency mining activities. Musin said that the country needed to expand its revenues from the sector by tapping into the trades made from the mined cryptocurrency assets. He said the move would help the country reach the next phase of financial technology prowess.
