Kazakhstan authorities have blocked over 3,500 illegal cryptocurrency exchanges in a move to address money laundering concerns.
According to a recent press release from the AFM RK, the country’s financial watchdog, the regulator liquidated 36 illegal crypto platforms in 2024 with a combined turnover of 60 billion tenge (roughly $112.84 million) and has blocked access to over 3,500 unregistered crypto trading platforms in collaboration with the National Security Committee and the Ministry of Culture and Information.
Citing an uptick in money laundering activities, the regulator said these exchanges lacked anti-money laundering measures and did not impose proper Know-your-customer protocols, making them a preferred channel for criminals, such as scammers and drug traffickers.
As a part of the crackdown, the regulator also seized 4.8 million USDT from these platforms.
Among other efforts, the government managed to dismantle two crypto pyramid schemes and recovered 545,000 USDT while freezing an additional 120,000 USDT linked to these fraudulent operations.
The AFM RK will continue to collaborate with its international partners and improve tools to bolster transaction monitoring to combat crypto crime, the release noted, adding that new regulations are being introduced to hold digital asset providers accountable for failing to comply with AML laws.
The recent efforts are part of a broader crackdown on illicit crypto activities in Kazakhstan. As previously reported by crypto.news, AFM Chairman Zhanat Elimanov said in an October 2024 statement that the country will also focus on mitigating unlawful crypto mining alongside its ongoing efforts to target unlicensed exchanges and unlawful transactions involving crypto.
Kazakhstan has become a key cryptocurrency market, especially since China’s crackdown on crypto mining and crypto use in 2021 led to an exodus of miners and crypto-related businesses to that region.
Per a December report from RISE Research and Freedom Horizons, the burgeoning crypto market has seen a hike in tax revenue generated from the sector, while the number of locals owning digital assets has also doubled in 2024.
However, the nation has maintained a stringent regulatory environment and has blocked access to foreign crypto platforms it deems have breached its digital asset laws. For instance, United States-based Coinbase was blocked in December 2023 for offering uninsured cryptocurrencies.
Yet, that hasn’t deterred other players like Binance and Bybit, who have both applied and secured preliminary approval to offer trading and custodial services within Kazakh borders.
