The government of Armenia is taking steps to adopt consistent regulations for the Caucasian nation’s crypto market and is currently considering the necessary legislative changes, according to a high-ranking official of the central bank in Yerevan.
Armenian authorities hope that the new framework will govern relations in the crypto space, introduce “financial hygiene” regarding ownership and capital of companies, and allow traditional financial institutions to provide crypto-related services as they have already shown interest in doing so.
Armenia sets out to adopt comprehensive crypto regulations
The Armenian government wants to introduce uniform rules for crypto assets, local media reported, quoting Armen Nurbekyan, deputy governor of the Central Bank of Armenia (CBA) which the country’s main financial regulator.
Nurbekyan took part in discussions on a package of draft laws and amendments to existing legislation designed to regulate operations with cryptocurrencies. The meeting was hosted by the Standing Committee on Financial-Credit and Budgetary Affairs on Monday at the National Assembly of Armenia.
Current regulations in this area are limited to setting requirements for crypto exchange offices, the central bank executive remarked, quoted by the News.am information agency.
The new rules will cover a wider range of entities involved in crypto business, the CBA representative emphasized. He also highlighted that the upcoming regulations will not concern the technological side of cryptocurrencies but only focus on the financial aspects.
Yerevan to impose ‘financial hygiene mechanism’ on crypto industry
In the future, companies issuing and trading crypto assets in Armenia will be required to disclose information about their owners and meet minimum capital requirements.
The procedures for issuing digital coins will be simplified, and Armenian regulators believe this will actually help to avoid a number of risks.
“In addition, a ‘financial hygiene’ mechanism will be introduced in Armenia. In essence, this means overseeing the founders of companies working with cryptocurrency, as well as sources of capital,” the report unveiled.
Armenia’s monetary authority is convinced this approach will significantly reduce the risks associated with money laundering in the country.
“In the presence of uniform rules, Armenian banks, which have long been interested in this domain, can also officially offer cryptocurrency services,” Armen Nurbekyan insisted.
The legislative initiative was approved by the parliamentary committee and will be sent to the members of the Armenian legislature for further consideration and adoption.
Armenia makes its first attempt to regulate cryptocurrencies
Armenia, a nation of around 3 million people situated in the South Caucasus, has only recently embarked on regulating its crypto industry. Reporting on the legislative efforts at the end of February, Finance Minister Vahe Hovhannisyan highlighted the risks accompanying the growing activities and opportunities in the space.
Hovhannisyan emphasized that the government’s main objective will be to protect the rights and legitimate interests of digital asset holders and customers in Armenia’s crypto market while ensuring its fair and transparent functioning.
He added that the proposed draft laws also seek to reduce systemic risks for the country’s financial stability stemming from the continued growth of cryptocurrency circulation in Armenia and revealed that the amendments will allow the CBA to receive detailed information about crypto-related activities.
“This is our first attempt to regulate the cryptocurrency sector. This is a very important step that must be taken boldly and decisively and we must continue our work in this direction,” Prime Minister Nikol Pashinyan noted during the cabinet meeting, admitting that the legislation isn’t perfect. “We are late, but better late than never,” Pashinyan concluded.
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