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- Regulating cryptocurrency exchanges in line with local economies for maximum benefits
- Ultimate Onus of investing in cryptocurrencies to remain with the individual
The National Bank of Kyrgyz Republic [NBKR] has officially confirmed its intentions to regulate exchange operations with cryptocurrency. The purpose is to make suitable conditions for dealing with crypto for clients and ordinary citizens. Licenses would be granted to cryptocurrency exchange operators for buying and selling cryptocurrencies. In a simplified environment, if one wants to purchase bitcoins, they go to the exchange office and pay the money and immediately bitcoins purchased are guaranteed to be recorded in the user’s name.
NBKR making its stance clear on cryptocurrency
However, the authorities have maintained their stance that the final decision of trading in cryptocurrency remains with the client. The prices can fluctuate and are not predictable. It’s a very high-risk investment as the price can trade as high as $50,000 or fall to $20 in no time. The risk of investing in bitcoin is that it is issued by private individuals and not by the state.
In terms of benefit to the local economy, just like the US and American economy are running to promote the US Dollar growth, the Kyrgyz Republic and the Kyrgyz economy would be behind the som.
The pace of Regulation Implementation
The Chairman of the National Bank has stated that the draft law on the circulation of cryptocurrency has been submitted for the public discussion post. It will be sent for the President’s approval. The targeted completion for this law to be implemented is by the end of 2021.
It should be noted that the purpose of Presidential decree is for regulating them. There is a lot of free information available that can perhaps swing a client’s decision-making in any direction. Since there is no guarantee in this area, the NBKR has been holding regular discussions with commercial banks and citizens on cryptocurrencies and how regulations can be implemented and followed.
The mining aspect has also been bought about, but the authorities presently seem to dodge around the same. Specific questions and investigations appear to have been conducted, but there is no firm answer on the same with the ultimate Onus of investing remains in the clients’ hand. This is a crucial step by a nation ready to take a step towards regularizing the process and perhaps offer a roadmap to other economies that may be willing to introduce the concept at a larger scale.
