Authorities in Uzbekistan restrict access to online crypto trading platforms based outside the country and not registered under their laws. A presidential decree obliges residents and local companies to use only digital asset exchanges licensed by the government of the Central Asian nation.
Uzbekistan is taking steps to prevent crypto trading and custody on foreign platforms
Uzbekistan’s National Agency of Perspective Projects (NAPP) has registered an increase in activities on online platforms that offer crypto-related services to Uzbeks without the required license. The regulator says these facilitate the trading of cryptocurrencies and ask for personal information without complying with a requirement to have the servers installed in the country.
In a recent statement, the agency pointed out that such platforms “bear no legal responsibility for conducting operations with cryptoassets, cannot guarantee the legitimacy of transactions, as well as proper storage and confidentiality of the personal data of citizens of the Republic of Uzbekistan.” In light of these findings, the regulator has restricted access to their domains.
The announcement highlights that the government of Uzbekistan has made consistent efforts to improve the regulatory and institutional framework in the crypto space. A decree signed by President Shavkat Mirziyoyev in 2018 defined the types of business activities related to digital assets such as the mining of cryptocurrencies and the provision of services related to their circulation.
Providers whose activities are subject to licensing include mining pools, cryptocurrency exchanges and depositories, as well as other crypto companies that offer individuals or legal entities services for the purchase, sale, exchange, storage, issuance, placement and management of crypto assets.
Regulations passed last April allow Uzbeks and businesses based in their country to acquire, sell and exchange cryptocurrency exclusively on domestic platforms, starting January 1, 2023. NAPP now emphasizes that this does not mean that local firms and residents have the rights . to carry out such transactions on foreign platforms before this date.
So far, Uzbekistan has only licensed one cryptocurrency exchange. Operated by South Korean entity Kobea Group, Uznex was launched in January 2020. Last fall, the National Agency of Perspective Projects issued a warning to Uzbek crypto traders to avoid unlicensed exchanges, giving them a simple legal option.
The agency has also reminded all residents of the country that they can conduct crypto transactions on registered exchanges with the national currency, such as, and sell crypto assets to non-residents for foreign fiat currency. NAPP urges Uzbekistan citizens not to use the services of online platforms that have not been licensed to operate in the republic and to report them to law enforcement.
Do you expect Uzbekistan to license more cryptocurrency exchanges in the future? Tell us in the comments section below.
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