Kuwait has become the latest jurisdiction to ban virtually all operations involving cryptocurrencies.
The country’s main financial regulator, the Capital Markets Authority (CMA), issued a statement on the supervision and issuance of virtual assets in the country.
In the statement the CMA confirmed the commitment to “absolute prohibition” on operations involving cryptocurrencies, including payments, investments and mining.
It also bans local regulators from issuing any licenses allowing firms to provide virtual asset services as a commercial business.
Apart from the prohibitions, the CMA also required customers to be cautious and aware of the risks associated with virtual assets. The regulator particularly flagged cryptocurrencies, arguing that they “don’t carry a legal status and are not issued or supported”.
The CMA added: “It is not linked to any asset or issuer, and that the prices of these assets are always driven by speculation that exposes them to a sharp decline.”
Kuwait’s new regulations align with the country’s measures to combat money laundering and terrorist financing, the regulator stated. The CMA also referred to the conclusions of a study by the National Committee for Combating Money Laundering and Financing of Terrorism regarding the commitment to applying recommendation 15 by the Financial Action Task Force. Recommendation 15 concerns the prevention of the the misuse of virtual assets for money laundering and terrorist financing.
According to local reports, the CMA’s crypto restrictions are part of a new inter-departmental crypto ban involving several supervisory authorities in Kuwait. Similar circulars have reportedly been issued by the Central Bank of Kuwait, the Ministry of Commerce and Industry and the Insurance Regulatory Unit.
