AIFC cautions against unlicensed crypto exchanges in Kazakhstan

The Astana International Financial Center (AIFC) warns that using unlicensed cryptocurrency exchanges on their platform carries high risks for Kazakhstani citizens. However, restricting access to such exchanges is not within the center’s authority, reports a Kazinform News Agency correspondent.

Kazakhstani users may face legal consequences if they use cryptocurrency exchanges that are not licensed by the AIFC. These platforms are freely available on the internet.

In response to a query from Kazinform News Agency, the center’s press service explained that the AIFC is working closely with government bodies to identify unlicensed platforms that are dangerous for Kazakhstanis. However, they lack the authority to restrict access to them - they can only inform the public about the potential criminal liability for using these online resources.

“Using unlicensed trading platforms carries high risks. Typically, the activities of such platforms are not regulated. Citizens should consider the risks of conducting transactions on unlicensed trading platforms abroad,” the AIFC emphasized.

Kazakhstanis usually use unlicensed cryptocurrency exchanges due to the broader range of products and services they offer compared to the center’s platforms. The AIFC assured that the number of services provided on their platforms is also increasing to enhance their attractiveness to users.

Before obtaining a license from the AIFC, an exchange undergoes several checks to confirm its financial and other resources, transparency, openness to regulation, and compliance with high information security standards. The authority ensures that the applicant’s platform will not be used for money laundering or financing terrorism.

Meanwhile, to become a crypto coach in Kazakhstan and teach users how to use digital assets, a license is not required. The AIFC clarified that their rules only regulate services related to investment choices.

“This type of regulated activity involves providing services to an investor or potential investor to help them decide on a particular investment or express interest in a specific investment for purchase, sale, storage, subscription, or guaranteed placement. However, providing educational services, including in the field of digital assets, such as “crypto coaches” or “crypto trainers” is not regulated by the AIFC legislation,” the press service explained.

Thus, oversight, licensing, and taking measures against crypto coaches are not within the center’s authority.

Previously, the chairman of the Kazakhstan Association of Blockchain Technologies and Artificial Intelligence, Dauren Karashev, criticized the AIFC for loopholes in dealing with cryptocurrency exchanges in Kazakhstan. According to him, licensed platforms in the country have their global counterparts that are not registered with the AIFC. Using this kind of platforms may lead to legal consequences.