Kuwait Bans Crypto And Virtual Assets Transactions

July 20, 2023

Kuwait bans crypto and virtual assets transactions

The Capital Markets Authority (CMA), the primary financial regulator in Kuwait, released a circular on the oversight and issuance of virtual assets in the nation on July 18. The commitment to “absolute prohibition” on significant cryptocurrency use cases and operations, including payments, investments, and mining, was reaffirmed by the CMA in the circular. The Capital Markets Authority of Kuwait has formally reiterated the nation’s commitment to “absolute prohibition” of nearly all cryptocurrency activity. Kuwait is the most recent state to forbid almost all transactions involving cryptocurrencies like Bitcoin.

The circular also prohibits regional authorities from giving any permits permitting companies to offer virtual asset services as a for-profit enterprise. The notification states that the most recent restrictions do not apply to securities and other financial instruments governed by the Central Bank of Kuwait and the CMA.

In addition to the limitations, the CMA demanded that users exercise caution and knowledge of the dangers related to virtual assets. Cryptocurrencies were singled out by the regulator, who claimed that “they don’t carry a legal status and are not issued or supported.”

According to the regulator, Kuwait’s new rules align with the country’s efforts to thwart money laundering and terrorist financing. The National Committee for Combating Money Laundering and Financing of Terrorism’s study findings addressing the commitment to implementing Financial Action Task Force recommendation 15 were also mentioned by the CMA.

The CMA’s crypto restrictions, according to local media, are part of a new inter-departmental crypto prohibition involving multiple supervisory authorities in Kuwait. According to reports, the Central Bank of Kuwait, the Ministry of Commerce and Industry, and the Insurance Regulatory Unit have all released similar circulars.

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