- Kuwait has banned the use of cryptocurrencies and virtual assets.
- Top regulators in the country issued a joint address via a circular.
- The circular explicitly banned the use of virtual assets as a means of payment.
Regulatory authorities in Kuwait have banned the use of cryptocurrencies and virtual assets. The country’s top regulators issued a joint address via a circular. They warned the citizens of Kuwait against the risks of engaging in cryptocurrency activities. The circular explicitly banned the use of virtual assets as a means of payment and prohibited any transactions involving cryptocurrencies for payment.
Kuwait’s crypto ban follows guidance included in recommendations published by the Financial Action Task Force watchdog for combating money laundering and the financing of terrorism. Several regulatory institutions came together to enforce the ban. They include the Central Bank of Kuwait, the Capital Markets Authority, the Ministry of Commerce and Industry, and the Insurance Regulatory Unit.
Also included in the ban is the use of cryptocurrencies for investment. Kuwaiti authorities noted the absence of legal status and government support for cryptocurrencies. It also emphasized the risks associated with cryptocurrency transactions. One such risk is the volatile nature of cryptocurrencies, which makes them susceptible to rapid fluctuations and sharp declines.
The authorities clarified they had not issued licenses to any entity to carry out cryptocurrency-related businesses in any form in Kuwait. It also stated that it prohibits granting any such license to individuals, including those engaging in any kind of crypto-mining activities.
Kuwaiti authorities explained that the ban aims to eliminate risks and negative consequences associated with crypto investments. It recognized the increasing interest in cryptocurrencies like Bitcoin, Ethereum, and Dogecoin among citizens of the country. Hence, the government, via local authorities, embarked on an awareness campaign to educate the public about the potential hazards of engaging in crypto activities.
The government emphasized that crypto assets are highly volatile and lack supervision and regulation within Kuwait.
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