• Kuwait has issued a circular banning the use of cryptocurrencies for payments, investments, and mining.
• The prohibitions are an effort to meet requirements set by the FATF on preventing money laundering via crypto.
• Companies are not allowed to provide any type of crypto-related services and any violations would result in penalties.
Kuwait Cracks Down on Crypto
The Capital Markets Authority of Kuwait has prohibited the use of cryptocurrency for payments or investment to combat money laundering.
Banning Payments, Investment and Mining
The circular released by the financial regulator placed an “absolute” ban on all digital asset mining and warned citizens against volatile encrypted currencies that do not have legal status. It also prohibited the recognition of crypto as decentralized currency and warned companies from providing any type of crypto-related services.
Meeting Requirements Set By FATF
The prohibitions are aimed at coming into compliance with Financial Action Task Force’s (FATF) global recommendations for crypto assets. This follows a study done by National Committee for Combating Money Laundering and Financing of Terrorism.
Penalties For Violations
Any violation of these prohibitions will result in penalties according to the notice.
„Securities Excluded From Ban“
„Securities regulated by the Central Bank of Kuwait and other securities and financial instruments regulated by the Capital Markets Authority are excluded from this prohibition,“ said the circular.