Kazakhstan, a prominent player in the global cryptocurrency mining sector, implemented stricter regulations on crypto activities throughout 2024.
According to the government website, in 2024, 36 illegal crypto exchanges were shut. A total turnover of 60 Billion Tenge were destroyed. Furthermore, assets in the amount of $ 4.8 million (about 2.5 Billion Tenge) were frozen and confiscated.
According to the government, “Such entities (illegal crypto exchanges) do not identify their clients and do not identify suspicious transactions. Therefore, their services are often used by cyber crooks and drug traffickers.”
“As a result of joint work with the National Security Committee, the Ministry of Culture and Information, more than 3.5 thousand illegal online crypto-exchange services were blocked,” the website said.
The country’s Financial Monitoring Agency said that it will continue to work with international partners to strengthen control over illegal crypto-transactions and combat their use for criminal purposes.
🇰🇿Kazakhstan blocked 3,500 illegal crypto exchanges, including Coinbase in 2023, while only select exchanges like Binance and Bybit secured licenses to operate.https://t.co/m0xJKPBm48 pic.twitter.com/d8oCZwTXCV
— Telo News (@Telo_Official) January 8, 2025
Kazakhstan Emerged As A Crypto Mining Hub After China’s 2021 Ban On Crypto Mining Activities
Kazakhstan quickly became the second-largest Bitcoin mining hub globally. It accounts for nearly 18% of Bitcoin’s total hash rate at its peak. Its low electricity costs and surplus energy from coal-fired power plants attracted miners from around the world.
To capitalize on the growing crypto industry, Kazakhstan introduced a tax framework targeting miners.
However, enforcement challenges persisted due to non-compliance by many operators.
While the Central Asian nation has been a haven for crypto miners due to its abundant energy resources and favorable policies, the recent crackdown signals a shift in its approach.
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Central Asia Update
Recently, Kyrgyzstan announced an ambitious plan to integrate cryptocurrencies into its financial ecosystem through licensed crypto banks.
“Given the rapid development of digital technologies and cryptocurrencies, the creation of a crypto bank is an urgent necessity for the integration of crypto assets into the traditional financial system of the country,” said Kyrgyzstan’s Ministry of Economy and Commerce.
According to a 7 January 2025 Times of Central Asia report, public interest in cryptocurrencies is growing among individuals and businesses in Kyrgyzstan. However, the market remains poorly regulated.
The Ministry believes that a licensed crypto bank will address these challenges, increasing transparency, trust, and financial security.
Read more: This Week In Crypto Asia: Indonesia Crosses $30 Billion In Crypto Transactions In 2024
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