Kyrgyzstan central bank plans to introduce licenses for crypto exchanges

The National Bank of the Kyrgyz Republic, or NBKR, is said to be planning to introduce a licensing system for cryptocurrency exchanges in a move to protect local investors.

NBKR Chairman Tolkunbek Abdygulov announced that the country’s central bank plans to start regulating exchange operations involving cryptocurrencies such as Bitcoin (BTC), local economic bulletin Tazabek reported on February 12th.

Abdegulov said the regulatory initiative aims to protect crypto operations in the Kyrgyz Republic and provide investor protection similar to those already in place for conventional financing:

“The goal of NBKR is to create conditions for the clients, for the citizens of the Kyrgyz Republic. If you want to buy Bitcoin – just go to the exchange office, pay the money and get the secured Bitcoin. […] Today you sell som, buy dollars – if the exchange office has a license from NBK, then there is no risk of losing money. There is a goal to do the same for cryptocurrencies. “

Despite NBKR’s ambitious plans to help locals invest safely in cryptocurrencies, the central bank continues to warn the public about the high risks of cryptocurrency investments. “If the bitcoin price reaches $ 50,000 yesterday, it may drop to $ 20,000 tomorrow. All your invested money will be burned,” Abdul-Golov warned.

After the introduction of the crypto bill in November 2020, the Kyrgyz government submitted two bills, “On the Processing of Cryptocurrencies” and “On Amendments to Legislative Acts in the Field of Virtual Assets” for public discussion in January 2021. The Kyrgyz authorities expect Abdul-Golov to say that the bills will be completed. By the end of 2021.

Aside from public legislative efforts on cryptocurrencies, Kyrgyzstan has also sought to regulate cryptocurrency mining activities in the country. However, no relevant regulation has yet been adopted, according to Abadigulov.