Ban On Payments Investment And Mining

Kuwait Cracks Down on Crypto

Ban on Payments, Investment, and Mining

FATF Compliance Efforts Cited

The state of Kuwait has become the latest jurisdiction to ban virtually all operations involving cryptocurrencies like Bitcoin (BTC). On July 18, the Capital Markets Authority (CMA), Kuwait's main financial regulator, issued a statement prohibiting the use of crypto assets for payments, investment, and mining within the country. The CMA's decision aligns with the recommendations of the Financial Action Task Force (FATF), an intergovernmental body that sets standards for combating money laundering and terrorist financing. The FATF has been vocal in its concerns about the potential for cryptocurrencies to be used for illicit activities.

The ban in Kuwait is a significant blow to the cryptocurrency industry, as the country represents a major market in the Middle East. The prohibition is likely to have a chilling effect on the adoption and use of crypto assets in the region.

The CMA's statement cited concerns about the volatility and lack of regulation surrounding cryptocurrencies. The regulator also noted that the use of crypto assets for payments could pose risks to consumers and businesses.

The ban on crypto mining is particularly notable, as Kuwait has been a major hub for the energy-intensive process. The country's low electricity costs have made it attractive for miners, who use specialized computers to solve complex mathematical problems and verify transactions on the blockchain.

The CMA's crackdown on cryptocurrencies is likely to have a ripple effect throughout the region. Other countries in the Middle East, such as Saudi Arabia and the United Arab Emirates, have also been exploring the regulation of crypto assets.