Uzbek authorities have restricted access to online crypto trading platforms that are based outside the country and not registered under its laws. A presidential decree requires citizens and local businesses to use only digital asset exchanges licensed by the Central Asian government.
Uzbekistan takes steps to prevent crypto trading and custody on foreign platforms
Uzbekistan’s National Agency for Prospects and Projects (NAPP) has registered a surge in the activity of online platforms offering crypto-related services to Uzbeks without the required license. According to the regulator, these are facilitating cryptocurrency transactions and requesting personal information without complying with the requirement to have a server in the country.
In a recentstatementthe agency noted that such platforms “do not assume legal responsibility for operating with crypto assets and cannot guarantee the legitimacy of transactions as well as the proper storage and confidentiality of personal data of citizens of the Republic of Uzbekistan.” In light of these findings, regulators have restricted access to their domains.
The announcement underscores the consistent efforts of the Uzbek government to improve the regulatory and institutional framework of the crypto space: a decree signed by President Shavkat Mirziyev in 2018 prohibits the mining of cryptocurrencies and the provision of services related to their distribution, including It defines the types of business activities related to digital assets.
Providers whose activities are subject to licensing include mining pools, cryptocurrency exchanges, depositories, and other crypto companies that provide services to individuals or legal entities for the purchase, sale, exchange, storage, issuance, placement, and management of crypto assets.
The regulations adopted in April allow Uzbekistanis and their country-based companies to acquire, sell, and exchange cryptocurrency exclusively on domestic platforms beginning January 1, 2023. the NAPP currently states that this is a local emphasizes that this does not mean that businesses or citizens will be granted the right to conduct such transactions on foreign platforms before that date.
So far, Uzbekistan has licensed only one cryptocurrency exchange. Uznex, operated by the South Korean entity Kobea Group, was launched in January 2020. Last fall, the State Prospects Project Agency warned crypto traders in Uzbekistan to avoid unlicensed exchanges, leaving them with only one legal option.
The Agency also reminded all residents of the country that they can perform crypto transactions on registered exchanges using the national currency, the Som, and sell crypto assets to non-residents for foreign fiat money.NAPP reminds Uzbekistan’s citizens operating in the republic not use the services of unlicensed online platforms and urges them to report them to law enforcement.
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