The Kazakhstan Government shut down 36 illegal cryptocurrency exchanges in 2024 following a joint work with the National Security Committee and the Ministry of Culture and Information.
The development was announced on Jan 6 by the Financial Monitoring Agency of the Republic of Kazakhstan.
Besides the 36 crypto exchanges shut down, about 3500 illegal online crypto exchanges were also blocked.
Kazakhstani authorities stated that such structures do not identify their clients and do not detect suspicious transactions. Therefore, their services are often used by cyber-fraudsters and drug traffickers.
The government of the country believes illegal crypto-exchangers have played a significant role in money laundering schemes, allowing the conversion of cryptocurrency into fiat currencies and vice versa.
Numbers associated with the exchanges
In 2024, 36 illegal crypto exchanges with a total turnover of 60 billion tenge were disrupted and shut down. Assets for $4.8 million (about 2.5 billion tenge) were blocked and confiscated by relevant authorities.
Two financial pyramids used by bad cryptocurrency actors to attract investments were exposed. $545,000 were returned and $120,000 were blocked.
Government Steps Up Legislative Approach
The Kazakhstan Financial Monitoring Agency has stepped up its partnership with international partners to strengthen control over crypto transactions and combat their use for illicit purposes.
The Government’s Legislative arm has made legislative amendments that will impose liability on digital asset providers for violations in the field of money laundering.
The verification process of cryptocurrency transactions in financial institutions has been strengthened by relevant authorities while the FMA will continue to improve effective control tools for financial transactions to combat criminal schemes.
The Asian country is also building an in-house central bank digital currency (CBDC) known as the digital tenge.
Development of the CBDC started in February 2023, with an initial launch deadline set for 2025.
