Kazakhstan intends to pilot cryptocurrency payments as part of a new policy of regulating rather than banning transactions with digital assets like Bitcoin.
The news from the Central Asian nation, which has established itself as a crypto mining hub, comes amid government efforts to legalize crypto-related operations.
Kazakhstan to permit crypto payments in pilot mode
Authorities in Kazakhstan want to try payments with digital coins in a pilot zone called “CryptoCity,” the country’s head of state announced at a forum in the capital city Astana, which brought together political and business leaders with representatives of international organizations.
The special venue will allow users to spend cryptocurrencies, said Kazakhstan’s President Kassym-Jomart Tokayev who addressed participants in the event devoted to global challenges in areas such as trade and energy. Quoted by the Trend news agency and Tengrinews, he stated:
“We plan to create an innovative pilot zone, CryptoCity, in which cryptocurrencies can be used to purchase goods, services and for other purposes.”
Tokayev did not provide more details about the project, which is the latest in a string of crypto-friendly initiatives aimed at allowing Kazakhstan to better tap into the profits generated in its growing crypto market.
The country became an attractive destination for Bitcoin miners after China’s decision to crack down on the industry and enforce a ban on crypto transactions in 2021. However, until recently, they had few legal options to exchange or spend their coins in the country.
Cryptocurrencies could be traded only on platforms registered at the Astana International Financial Center (AIFC), which resulted in the spreading of illegal exchange and the transfer of around $15 billion worth of crypto assets out of the country, according to an estimate by the central bank.
The government seems to have changed its strict regulatory approach lately, as evident in an article published by Kazakhstan’s Deputy Minister for Digital Development, Kanysh Tuleushin, earlier in May.
In the op-ed, Tuleushin urged for the adoption of “flexible rules” for the crypto space and calculated this could bring Kazakhstan over $370 million in annual budget receipts, much more than the $35 million it received from miners in the past three years.
Last week, the National Bank of Kazakhstan (NBK) announced it has drafted legislative changes to regulate the crypto market, including introducing a licensing regime for cryptocurrency exchanges operating across the country, not just in the AIFC hub. The monetary authority has been also pushing for a state-controlled trading platform.
Astana to strengthen Kazakhstan’s potential in digital tech and AI
In his speech at the Astana International Forum (AIF), Kassym-Jomart Tokayev touched on other priorities for his nation, including its aspiration to become a “Eurasian IT hub.”
The president emphasized the country is investing in human capital and expanding opportunities for young professionals as it seeks to enlarge its middle class. He also highlighted Kazakhstan’s progress towards digital transformation and stated:
“We pay special attention to artificial intelligence (AI). Our goal is to become an academic and innovation hub.”
The AIF, held in Astana on May 29-30, is attended by government officials from a number of countries as well as current and former international figures such as the Secretary General of the Council of Europe, Alain Berset, and the ex-Secretary General of the United Nations Ban Ki-moon.
This year, the organizers expanded their focus to cover a broader range of global issues such as energy security, climate action, geopolitical cooperation, international trade, technological innovation, and sustainable development, among which the crypto topic found its place, too. The forum’s main goal is to enhance collaboration and elaborate cross-sectoral approaches in all these areas.
Cryptopolitan Academy: Tired of market swings? Learn how DeFi can help you build steady passive income. Register Now
