In order to combat money laundering, the Kuwaiti government issued a ban on the use of crypto. The ban applies to crypto investments, transactions, and mining, according to a Monday notice from the country’s financial regulator.
Besides the Capital Markets Authority’s (CMA) ban on mining, they prohibited the recognition of cryptocurrencies as decentralized currencies. In addition to that, Kuwait’s CMA warned the public of accessing any crypto-related services from companies, as they are prohibited from providing such services.
Despite that, the notice said:
"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."
The prohibitions were put in place to comply with global recommendations for crypto assets by the Financial Action Task Force (FATF). CMA implemented these measures after studying the sector through the National Committee for Combating Money Laundering and Financing of Terrorism.
While countries must implement measures to prevent money laundering and comply with the FATF's travel rule, which mandates crypto firms to collect and share data on transactions surpassing a specific threshold, the international regulator clarified that it has not dictated countries to ban cryptocurrencies.
So far, only 8 countries have banned cryptocurrencies, with Kuwait becoming the 9th country. Despite that, many more countries continue to adopt cryptocurrencies, implement crypto-related policies, and improve the overall sector with crypto-friendly policies and taxes.
The regulatory authority cautioned citizens about the risks associated with unstable and unregulated cryptocurrencies that do not have legal status. The notice further stated that any violations of the prohibitions would incur penalties.
