By Lucas Williams
Crypto enthusiasts in Kazakhstan can soon expect to be able to open cryptocurrency bank accounts. Local news outlets reported that soon enough, Kazakh citizens can get the chance to transfer their income into cryptocurrency. They’ll also get the opportunity to sell their coins on the crypto exchange market, and invest in Bitcoin.
This exciting news stems from reports by the Kazakh Association of Blockchain and Data Center. They stated that the country’s crypto exchanges that registered can soon collaborate with the local banks. The report mentions exchanges that opened under the context of the Astana International Finance Center. This move will allow bank clients to officially work with cryptocurrency. Crypto enthusiasts can take advantage of this soon. It will activate once AIFC’s pilot project with second-tier banks launches.
To trade on the crypto exchange, the investor must have a legal account. They must be the holder, and the account should be in one of the AIFC-registered banks. Users can buy currency and use it to make purchases on the exchange market. And, they can transfer money as well.
Cautious investors can rely on the feature of transferring the received income back to their accounts in the shape of fiat currency. Here, the bank works as an intermediary for crypto-money transactions.
This pilot project between crypto exchanges and local banks is set to last for a year. It’s like an experiment by the Kazakh government to evaluate the benefits and risks that digital currencies pose. Currently, there are prohibitions on the circulation of cryptocurrency in Kazakhstan. Even so, market experts speculate that the crypto ban will grow less categorical. Some are optimistic that the ban will be lifted altogether once the pilot project is completed.
They explained that there are numerous reasons that crypto is gaining recognition in the country. Part of it has to do with China’s crackdown on Bitcoin mining and trading activities in 2019. It caused the superpower’s share in global Bitcoin mining to reduce by around 30 percent. Now, it makes up less than half of the Bitcoin network’s capacity.
Because of the significant drop, Kazakhstan’s mining shares grew sixfold, making the country the third-biggest crypto producer in the world. For context, between six and eight percent of the world’s crypto mining volume comes from Kazakhstan.
The current state of the world’s financial condition is that crypto makes up a large chunk of finance. Considering the crypto market cap, it’s billions and billions of dollars worth of turnover. So if Kazakhstan can make even a fraction of one percent, it can benefit the country immensely. This is according to the Kazakh Association of Blockchain and Data Center Industry’s Government Relations Coordinator, Sergey Putra.