Kyrgyzstan Central Bank Set To Regulate Crypto Exchanges

News / 12.02.2021

Asian nation Kyrgyzstan is set to license cryptocurrency exchanges operating within the country. According to authorities, this move is to prevent fraudulent activities as the popularity of Bitcoin grows in the country. 

Impending Crypto Regulation

Tolbunbek Abdygulov, the Chairman of the National Bank of Kyrgyzstan (NBKR), revealed this development on Friday. According to Abdygulov, the Apex bank wants to regulate crypto exchanges and offer licenses to approved platforms. “We plan to grant a license to cryptocurrency exchange operators to buy and sell cryptocurrency.

He further added that issuing a license to exchanges would help create a safe environment for citizens to trade cryptocurrencies. “Today, you sell some, buy dollars – if the exchange office has a license from the NBKR, there is no danger of losing money. He added. 

Bitcoin and other cryptocurrencies have increased in popularity in Krygyzstan due to their recent rise in value. However, crypto-assets pose financial risks due to their volatility, and Abdygulov is well aware of the risks. He stated that the apex bank regularly advises citizens of the risks involved when they purchase cryptocurrencies. 

“We advise our citizens: Investing in cryptocurrencies is very risky,” “If Bitcoin hit $50K yesterday, it could drop to $20K tomorrow. This is a very high-risk investment,” he concluded.

Cryptocurrency Regulations Vary Globally

The Central Bank of Kyrgyzstan’s move follows that of other countries in Asia that have moved to license cryptocurrency exchanges. Thailand and Japan are two Asian countries that have mandated the licensing of crypto exchanges within their jurisdiction. While in Europe, the United Kingdom ordered all crypto-related companies to register with the relevant regulatory body.

However, some countries are taking a stricter route and issuing limitations on cryptocurrency trading. For example, India is set to give a blanket ban on cryptocurrencies and put a law in place. Also, African nation Nigeria even made the news when its central bank ordered all banks to stop processing transactions for crypto exchanges. 

There are calls for a standardized framework for regulating cryptocurrencies globally from some organizations. Until this is achieved, cryptocurrency regulations will continue to vary among nations in the world.

Olowoporoku Adeniyi is a blockchain enthusiast and crypto evangelist. Currently he loves all things crypto and covers happenings within the blockchain space.