Key takeaways :
- Kazakhstan’s authorities have officially blocked access to the cryptocurrency exchange Coinbase.
- Kazakh authorities are pointing to Coinbase’s non-compliance with the newly enacted Law on Digital Assets.
In recent developments, the Ministry of Culture and Information in Kazakhstan has officially confirmed its decision to block access to the popular cryptocurrency exchange, Coinbase.
This action is part of the Kazakh government’s ongoing efforts to implement strict regulatory measures within the cryptocurrency sector, citing violations of local laws, as reported by local media sources.
The primary basis for these actions lies in Kazakhstan’s stringent “Digital Assets Law,” a comprehensive piece of legislation that has been introduced to establish a structured regulatory framework for the cryptocurrency industry and to provide specific guidelines for online brokerage activities.
In September, initial reports of access issues to Coinbase’s website surfaced when local Telegram media outlet, Finance.kz, revealed that the “great Kazakh investment firewall” was impeding access not just to Coinbase but also to Kraken and other prominent international cryptocurrency exchanges.
The primary reason cited was the violation of Article 11, Paragraph 5 of Kazakhstan’s Digital Assets Law, which strictly prohibits the issuance and trading of unsecured digital assets within the country.
Notably, various cryptocurrency exchanges, including industry giants like Binance, Bybit, and Upbit, have already received approval from the Astana Financial Services Authority (AFSA). For instance, Bybit was granted an ‘in-principle‘ license back in May, allowing the exchange to operate a digital asset trading facility and offer custody services under the AFSA’s purview.
However, Coinbase, alongside other exchanges like Kraken, has encountered difficulties in securing such approval from the regulatory authorities. In a bid to navigate these challenges, Binance opted to collaborate with a local bank in Kazakhstan, enabling fiat transfers, trading services, custody solutions, and currency conversions as of June.
This engagement demonstrated Binance’s commitment to providing comprehensive cryptocurrency services within the nation, going beyond mere trading operations.
The recent blockage of Coinbase’s website in Kazakhstan has immediate implications for both the cryptocurrency exchange itself and its user base in the country. With access denied, residents of Kazakhstan find themselves unable to engage in trading activities or access their Coinbase accounts, while the exchange encounters significant obstacles in serving its customers within the nation.
This unfolding situation underscores the evolving and complex landscape of cryptocurrency regulations on the global stage. As we continue to follow this story, it will be interesting to see how Coinbase and other exchanges adapt to these regulatory challenges in Kazakhstan and beyond.
