The Kazakh Senate passes a law regulating cryptocurrency service providers

According to a new law passed today by the upper house of the state parliament, crypto companies in Kazakhstan could soon be subject to anti-money laundering (AML) regulations, local news agency Vlast reported.

The new law adds cryptocurrency service providers to the country’s financial oversight system.

The new law also creates a legal organization for state officials. When a company launches a cryptocurrency trading service or issues a digital asset, it must notify the Kazakh Ministry of Digital Development, Innovation and Aerospace Industry. The organization is responsible for performing a risk assessment to ensure that Know Your Customer and AML regulations are being followed.

According to Vlast, Senator Olga Perepechina stated that Kazakhstan’s financial oversight system does not currently include legal entities dealing in digital assets, trading organizations or services for converting cryptocurrencies into money, cash, tangible goods and other assets.

The senator warned that this lack of oversight could lead to the rapid spread of money laundering and terrorist financing, as well as the growth of the black market. She warned that cyber criminals, including terrorists, are being encouraged to use digital assets and electronic methods in their settlements.

Related: Kazakhstan expects at least $ 1.5 billion in economic activity from crypto mining in 5 years

However, this proposal has not yet been approved by the country’s president, Kassym-Jomart Tokayev. Last month, Tokayev called for “quick” regulation of another cryptocurrency operation, Bitcoin (BTC) mining, citing the country’s energy deficit. The Central Asian country, which has the cheapest electricity in the world, has become a bitcoin mining hotspot amid the growing crackdown on China.

As reported by Cointelegraph, Kazakhstan predicts that cryptocurrency mining will add at least $ 1.5 billion to its economy within 5 years. The country’s current mining hash rate ranks second in the world after the United States.

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