In a significant development, Kuwait’s financial watchdog, the Central Markets Authority (CMA), has taken a firm stance against cryptocurrencies.
On July 19, the CMA issued a circular declaring all cryptocurrency activities, including crypto investment, crypto payments, and crypto mining, illegal within the Middle Eastern country.
The circular issued by the CMA leaves no room for ambiguity, categorically stating that all cryptocurrency-related activities are illegal in Kuwait.
This encompasses not only crypto investment and transactions but also crypto mining operations. Moreover, the CMA has prohibited local regulators from granting licenses to individuals or businesses attempting to provide cryptocurrency services commercially.
To emphasize the seriousness of the ban, the CMA highlighted that Kuwait’s anti-money laundering and terrorist financing laws carry severe punishments for those who flout the regulations.
The circular was explicit in exempting only securities regulated by the Central Bank of Kuwait and other financial instruments regulated by the Capital Markets Authority from the prohibitions.
In addition to implementing the ban, Kuwait’s financial regulator has taken the initiative to educate its citizens about the risks associated with cryptocurrencies.
The circular clearly states that cryptocurrencies do not carry any legal status and are not issued or supported by any regulatory authority in the country. By providing this information, the CMA aims to protect investors and consumers from potential financial losses and scams.
Kuwait has now joined the list of countries that have imposed restrictions on cryptocurrencies. Countries like Thailand, Indonesia, and Turkey also forbid accepting cryptocurrency payments within their territories.
This growing trend indicates that regulatory bodies are closely monitoring the crypto industry’s development and are implementing measures to mitigate potential risks.
The decision to ban cryptocurrencies in Kuwait comes after the National Committee for Combating Money Laundering and the Financing of Terrorism conducted a study focused on implementing Recommendation 15 of the International Requirements of the Financial Action Task Force (FATF).
It’s essential to note that while FATF provides recommendations for combating money laundering and terrorist financing, it does not mandate that countries outlaw cryptocurrencies entirely.
