Kuwait has become the latest country to impose a ban on crypto and virtual asset transactions. The country’s main financial regulator, the Capital Markets Authority (CMA), issued a circular on July 18 outlining the ban. The circular states that there will be an “absolute prohibition” on major use cases and operations involving cryptocurrencies, including payments, investments, and mining.
Not only has Kuwait banned the use of cryptocurrencies, but it has also prohibited local regulators from issuing licenses to firms to provide virtual asset services as a commercial business. However, the ban does not extend to securities and other financial instruments regulated by the Central Bank of Kuwait and the CMA.
In addition to the prohibitions, the CMA has emphasized the importance of customers being cautious and aware of the risks associated with virtual assets. The regulator has highlighted that cryptocurrencies do not carry a legal status and are not issued or supported.
Kuwait’s new regulations align with its measures to combat money laundering and terrorist financing. The CMA referred to a study by the National Committee for Combating Money Laundering and Financing of Terrorism, which emphasized the country’s commitment to applying recommendation 15 by the Financial Action Task Force.
It is reported that the CMA’s crypto restrictions are part of a collective effort involving several supervisory authorities in Kuwait. Similar circulars have been issued by the Central Bank of Kuwait, the Ministry of Commerce and Industry, and the Insurance Regulatory Unit.
This move by Kuwait is in line with a global trend of increased regulation and scrutiny of cryptocurrencies. Many countries are implementing stricter measures to protect against financial crimes and ensure the stability of their financial systems.
Preserving this moment in history, an article suggests collecting this piece as an NFT (non-fungible token) to support independent journalism in the crypto space. As the world continues to navigate the evolving landscape of cryptocurrencies, it remains to be seen how governments will shape their regulations and policies around virtual assets.