20 Jul 2023 Arjun Agarwal
Kuwait Puts An Absolute Ban On Crypto And Virtual Asset 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 "absolute prohibition" includes significant cryptocurrency use cases and operations like payments, investments, and crypto mining initiative, he CMA explained in the circular.
The circular also prohibits regional authorities from giving any permits permitting companies to offer virtual asset services as a for-profit enterprise.
However, the notification stressed that the most recent prohibitions do not apply to securities and other financial instruments governed by Kuwait’s Central Bank the CMA.
The CMA also stressed that users have to proceed with greater caution and knowledge of the dangers in the virtual assets subsector. When it comes to cryptocurrencies, the CMA blacklisted them under the explanation that they "don't carry a legal status and are not issued or supported."
“It is not linked to any asset or issuer, and that the prices of these assets are always driven by speculation that exposes them to a sharp decline.” the CMA added.
Article 15 of Law No. 106 of 2013 lays out the penalty for breaking Kuwait's anti-money laundering regulations, the regulator added.
Kuwait's new regulations are the latest step in the country's efforts to halt 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 seem to be a part of a new inter-departmental crypto prohibition legislation, with multiple supervisory authorities joining in the war against crypto in Kuwait. According to The Central Bank of Kuwait, the Ministry of Commerce and Industry, and the Insurance Regulatory Unit have all joined forces with the CMA to prohibit the usage of cryptos and virtual assets.
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