Source: AdobeStock / Pavel Parmenov

As countries across the world intensify efforts to attract crypto industry players, the authorities of Kazakhstan have launched a pilot program to encourage selected local banks to partner with licensed crypto exchanges.

In a statement, the country’s government said that the exchanges that are registered with the Astana International Financial Centre (AIFC), a financial hub based in Kazakhstan’s capital Nur-Sultan, are eligible to open accounts with a number of local banks.

Per the Astana Financial Services Authority (AFSA) public register, there is a number of listed companies with “active” licenses, which are operating “an exchange,” “a clearing house,” “a digital asset trading facility,” and/or “providing/arranging custody.” These include Bitfinex Securities Ltd., Upbit Eurasia Ltd., Biteeu Eurasia Ltd., ATAIX Eurasia Ltd., Xignal&MT Ltd., and Eurasia Blockchain Fintech Group Limited. The licenses of several more such companies have been “suspended by participant.”

As part of its plan to lure crypto-oriented businesses, a special working group has been set up to develop the rules of cooperation between crypto exchanges and Kazakh banks. 

The group includes representatives of the country’s Ministry of Digital Development, Innovation and Aerospace Industry, the central National Bank of Kazakhstan, the Agency for Regulation and Development of Financial Markets, the Agency for Financial Monitoring, the Association of Financiers of Kazakhstan, the AFIC, as well as representatives of the banking and digital assets sectors, according to the statement.

Bagdat Musin, Kazakhstan’s Minister of Digital Development, Innovation, and Aerospace Industry, noted that the crypto industry comprises not only mining, but cryptoassets, digital currency, digital wallets, and blockchain technologies, stating:

“This is an industry that, like other industries, can work for the good of the country and benefit our economy. We need to turn the cryptocurrency exchange into a source of income and move to the next level of financial technology development.”

The government official further argued that, 

“It is necessary to create a full-fledged ecosystem, so that digital assets generated by Kazakhstan’s electricity will be traded on local cryptocurrencies, and revenues will remain in the country. At the same time, we have an appropriate platform, such as the AIFC.”

Earlier this month, Kazakhstan’s National Bank stated that it is “interested in” the “opportunities for innovation” that cryptoassets and decentralized finance (DeFi) can “give” the government.

Meanwhile, just this May, the AIFC announced that it had been visited by the CEO of major crypto exchange Binance, Changpeng Zhao, who got “acquainted with [the AIFC] activities,” among other things. 

“In October 2021, Binance registered as an AIFC Participant and is currently undergoing the authorization procedure with the [AFSA] to obtain a license to trade in digital assets or a crypto exchange,” said the announcement. 

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