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Kazakhstan to allow crypto purchases with local currency

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(Kitco News) - Kazakhstan has announced that it is ready to legalize a way for people to conduct cryptocurrency conversions if there is sufficient demand, according to President Kassym-Jomart Tokayev. 

The comments from Tokayev came during a speech at the international forum Digital Bridge 2022, where the head of state emphasized that Kazakhstan intends to become a leading player in the field of new digital technologies with the creation of a robust cryptocurrency ecosystem and a regulated and transparent digital mining network. 

According to Tokayev, the government of Kazakhstan has drafted amendments in national law to allow a pilot mechanism for converting crypto at the Astana International Financial Centre.

"Currency conversion is already being carried out at the site of the Astana International Financial Center under a special pilot project. For this, quite innovative changes were made to national legislation and the regulatory environment. And we are ready to go further,” Tokayev declared. 

Depending on the success of the pilot, the program has the potential to be fully legalized and expanded.

“If this financial instrument shows its further demand and security, then it will certainly receive full legal recognition," Tokayev said. 

Local reports coming out of Kazakhstan indicate that the Eurasian Bank and Intebix have jointly completed the bank's first regulated crypto purchase for fiat, marking the first time that citizens have been able to legally buy crypto using the country’s tenge currency. 

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The pilot program was launched in the capital city of Astana during the summer between Kazakh banks and crypto exchanges licensed in the AIFC. The stated goal of the project is to test the opening of accounts for crypto exchanges and their clients in Kazakhstani banks. 

Some of the other companies involved in the pilot include Halyk Bank – Kazakhstan's largest bank– Altyn Bank, Eurasian Bank, and crypto exchanges like ATAIX Eurasia and Biteeu Eurasia. 

The pilot is expected to run in test mode until the end of 2022.

This development comes as thousands of Russians have begun flooding into Kazakhstan following the announcement of a partial mobilization of reservists to fight in Ukraine by Russian President Vladimir Putin. Halyk bank had previously suspended the use of Russia’s Mir payment cards in an effort to not run afoul of sanctions placed by the U.S. Treasury Department. 

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