Kazakhstan, emerging as a cryptocurrency hub in Central Asia, has intensified its crackdown on illicit activities within the crypto sector. This year, the government’s Financial Monitoring Agency (AFM) reported the closure of 130 cryptocurrency platforms involved in financial scams.

According to an AFM spokesperson, these platforms were primarily linked to money laundering schemes. The authorities have also seized approximately $16.7 million worth of various cryptocurrencies tied to these illegal operations, confirming reports from local media.

In the previous week, the AFM disclosed that it confiscated $642,000 from illegal mining ventures, reflecting Kazakhstan’s stringent approach towards illicit cryptocurrencies while promoting their adoption.

New Anti-Money Laundering Measures for Money Transfers

As part of initiatives aimed at reducing illegal financial activities, Kazakhstan is set to implement new requirements impacting money transfers.

Under the guidance of AFM Deputy Chairman Kairat Bizhanov, all top-ups of bank cards exceeding 500,000 tenge (about $925) will necessitate the sender’s Individual Identification Number (IIN) verification, as reported by the local news agency Baq.kz. Previously, only the recipient’s IIN was required. Furthermore, they are considering a verification option through mobile apps or SMS.

Previous Year’s Data

In addressing the shutdown of 130 crypto platforms this year, an AFM representative pointed out that these platforms operate distinctly from traditional centralized cryptocurrency exchanges (CEXs). They are typically akin to standard currency exchange offices and are known as crypto exchangers. Notably, the AFM had only reported the closure of 36 such platforms the prior year.

As of the publication date, the public registry for digital asset service providers maintained by the Astana Financial Services Authority indicates that 20 crypto platforms have been authorized to function in Kazakhstan, including prominent CEXs like Bybit and WhiteBIT.

Kazakhstan is striving to position itself as a significant cryptocurrency hub in Central Asia, pioneering initiatives such as the payment of regulatory fees in stablecoins and planning to establish a state-backed crypto reserve. However, it remains uncertain whether the confiscated funds will contribute to this prospective reserve, as legal frameworks are still under development.