Kazakhstan
Retail_Trading_Status
- Analysis ID
- #181
- Version
- Archived
- Created
- 2025-04-12 06:53
- Run
- 3199ea5a...
- History
- View all versions
- Workflow Stage
- Live
Executive Summary
Kazakhstan generally prohibits the circulation of unsecured digital assets, allowing retail trading only through licensed exchanges within the Astana International Financial Centre (AIFC). The Astana Financial Services Authority (AFSA) regulates crypto activities within the AIFC, imposing strict AML/KYC requirements and licensing for digital asset trading facilities. The "Law on Digital Assets in the Republic of Kazakhstan" (April 1, 2023) bans unsecured digital assets outside the AIFC. Recent proposals suggest stricter banking controls on transactions involving unlicensed foreign crypto exchanges, and a 10% capital gains tax applies to income from digital asset sales.
Key Pillars
The primary regulator is the Astana Financial Services Authority (AFSA), which oversees cryptocurrency activities within the Astana International Financial Centre (AIFC). Core compliance requirements include robust Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) measures, customer identification (KYC) procedures, secure storage methods, and reporting obligations. Companies operating digital asset trading facilities must obtain an AFSA license ('Operating a Digital Asset Trading Facility').
Landmark Laws
- Law on Digital Assets in the Republic of Kazakhstan: Effective April 1, 2023. Generally bans the issuance and circulation of unsecured digital assets and the operation of exchanges for such assets in Kazakhstan, except within the AIFC.
Considerations
Cryptocurrencies are legally classified as property, with income from their sale subject to a 10% capital gains tax. There are restrictions on the types of crypto assets available to retail investors (only AFSA-approved/licensed assets). Banks may be required to block transfers to unlicensed (non-AIFC) foreign crypto exchanges. There are also reports of potential investment limits for retail investors without proven knowledge/experience.
Notes
The AIFC operates as a special economic zone with its own regulatory framework. The pilot project in the AIFC, allowing interaction between registered crypto exchanges and commercial banks, has been extended past its initial 2022 end date. Cryptocurrency mining is legal but subject to regulation, including licensing requirements and mandates for miners to sell a portion of their mined assets through AIFC-registered exchanges. There are reports of restrictions on operations like P2P trading and certain yield-generating products within the AIFC. Information source access may require subscription or institutional login.
Detailed Explanation
Detailed Explanation
Kazakhstan has a bifurcated approach to cryptocurrency regulation. Generally, the "Law on Digital Assets in the Republic of Kazakhstan," effective April 1, 2023, prohibits the circulation and use of unsecured digital assets like Bitcoin and Ether as payment instruments and bans the operation of exchanges for such assets. However, an exception exists within the Astana International Financial Centre (AIFC), where a special legal regime is in place. The AIFC, regulated by the Astana Financial Services Authority (AFSA), initiated a pilot project, which has been extended past its initial 2022 end date, allowing interaction between AIFC-registered crypto exchanges and Kazakhstan's commercial banks. Individual citizens and residents are permitted to buy, sell, and hold cryptocurrencies, but only through exchanges licensed by the AFSA and operating within the AIFC. These licensed entities, holding the license "Operating a Digital Asset Trading Facility," are subject to strict AML/CFT measures, KYC procedures, secure storage methods, and reporting obligations. Retail investors face restrictions on the types of crypto assets available (only those approved/licensed by AFSA) and potentially on the types of operations. Furthermore, proposals from October 2024 suggest banks will be required to block transfers to unlicensed (non-AIFC) foreign crypto exchanges and apply enhanced scrutiny for large transactions even with licensed AIFC entities. Income from the sale of digital assets is considered property income and is subject to a 10% capital gains tax. Cryptocurrency mining is legal but regulated, including licensing requirements and mandates for miners to sell a significant portion (e.g., 50% or more) of their mined assets through AIFC-registered exchanges. The circulation of many types of crypto assets are banned outside of AIFC and are not allowed to be used for payments. The AFSA supervises all cryptocurrency activity within the AIFC. The government is planning to introduce new restrictions for banks requiring them to automatically deny payments and transfers to cryptocurrency exchanges not registered with the AIFC.
Summary Points
Retail Cryptocurrency Trading in Kazakhstan: Regulatory Overview
1. Overall Regulatory Status: Allowed-Regulated (with significant restrictions)
2. Key Regulatory Bodies & Roles:
- Astana Financial Services Authority (AFSA):
- Primary regulator for cryptocurrency activities within the Astana International Financial Centre (AIFC).
- Issues licenses for "Operating a Digital Asset Trading Facility."
- Oversees AML/CFT compliance, KYC procedures, and secure storage practices for licensed entities.
- Agency for Regulation and Development of the Financial Market:
- National regulator planning to implement restrictions on banks regarding transfers to unlicensed crypto exchanges.
3. Key Legislation & Regulations:
- "Law on Digital Assets in the Republic of Kazakhstan" (Effective April 1, 2023):
- Generally prohibits the issuance and circulation of unsecured digital assets (e.g., Bitcoin, Ether, most stablecoins) outside the AIFC.
- Provides an exception for activities conducted within the AIFC.
- AFSA Rules and Regulations:
- Governs the operation of digital asset trading facilities within the AIFC.
- Includes requirements for licensing, AML/CFT, KYC, security, and reporting.
4. Requirements for Compliance (for AIFC-Licensed Exchanges):
- Licensing: Must obtain an "Operating a Digital Asset Trading Facility" license from the AFSA.
- AML/CFT: Robust Anti-Money Laundering and Counter-Terrorist Financing measures.
- KYC: Strict customer identification procedures.
- Security: Secure storage methods for digital assets.
- Reporting: Regular reporting obligations to the AFSA.
5. Notable Restrictions & Limitations:
- Geographic Restriction: Retail trading is only permitted through exchanges licensed by the AFSA and operating within the AIFC.
- Asset Restrictions: Retail investors are limited to trading crypto assets approved/licensed by the AFSA.
- Operational Restrictions: Potential limitations on types of operations (e.g., P2P, futures trading, certain yield-generating products) may apply depending on the platform's AIFC license.
- Potential Investment Limits: Possible investment limits for retail investors without proven knowledge/experience (details may vary).
- Banking Restrictions (Proposed): Banks may be required to block transfers to unlicensed (non-AIFC) foreign crypto exchanges and apply enhanced scrutiny for large transactions even with licensed AIFC entities.
6. Recent Developments & Changes:
- Extension of AIFC Pilot Project: The pilot project allowing interaction between AIFC-registered crypto exchanges and Kazakhstan's commercial banks has been extended.
- Proposed Banking Restrictions (October 2024): The Agency for Regulation and Development of the Financial Market is planning to introduce new restrictions on bank transfers to unlicensed crypto exchanges.
7. Taxation:
- Income from the sale of digital assets is considered property income.
- Subject to a 10% capital gains tax on the difference between the selling and purchase price.
- Tax declarations are required.
8. Cryptocurrency Mining:
- Legal but regulated.
- Subject to licensing requirements.
- Miners may be required to sell a significant portion (e.g., 50% or more) of their mined assets through AIFC-registered exchanges.
Full Analysis Report
Full Analysis Report
Report: Retail Cryptocurrency Trading Status in Kazakhstan
Topic: Retail_Trading_Status
Description: Assess whether individual citizens and residents in the country are legally permitted to buy, sell, and hold cryptocurrencies. Detail the regulatory environment surrounding this activity (e.g., KYC/AML requirements imposed on platforms, general warnings issued).
1. Status: Allowed-Regulated
2. Detailed Narrative Explanation:
Kazakhstan has adopted a distinct approach to cryptocurrency regulation, generally prohibiting the circulation and use of unsecured digital assets (like Bitcoin, Ether, and most stablecoins) as payment instruments within the main territory of the Republic of Kazakhstan. However, it has established a special legal regime within the Astana International Financial Centre (AIFC), a financial hub located in Astana (formerly Nur-Sultan).
- General Prohibition with AIFC Exception: The "Law on Digital Assets in the Republic of Kazakhstan," effective April 1, 2023, generally bans the issuance and circulation of unsecured digital assets and the operation of exchanges for such assets in Kazakhstan. However, it provides a specific exception for activities conducted within the AIFC.
- AIFC Pilot Project and Regulation: The AIFC, regulated by the Astana Financial Services Authority (AFSA), initiated a pilot project to allow interaction between AIFC-registered crypto exchanges and Kazakhstan's commercial banks. This project, initially set to end in 2022, has been extended. It allows for the circulation and trading of certain digital assets under specific conditions within the AIFC framework.
- Retail Trading within AIFC: Individual citizens and residents of Kazakhstan are permitted to buy, sell, and hold cryptocurrencies, but only through exchanges licensed by the AFSA and operating within the AIFC. This creates a regulated channel for retail participation.
- Regulatory Oversight: The AFSA oversees cryptocurrency activities within the AIFC. Companies operating digital asset trading facilities must obtain an AFSA license ("Operating a Digital Asset Trading Facility"). These licensed entities are subject to strict regulatory requirements, including robust Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) measures, customer identification (KYC) procedures, secure storage methods, and reporting obligations.
- Restrictions: While trading is allowed via licensed AIFC exchanges, there are limitations. Retail investors face restrictions on the types of crypto assets available (only those approved/licensed by AFSA) and potentially on the types of operations (e.g., P2P, futures trading, and certain yield-generating products like Binance Earn might be restricted on specific platforms operating under the AIFC license). There are also reports of potential investment limits for retail investors without proven knowledge/experience, although details might vary. Furthermore, recent proposals (October 2024) suggest banks will be required to block transfers to unlicensed (non-AIFC) foreign crypto exchanges and apply enhanced scrutiny for large transactions even with licensed AIFC entities.
- Taxation: Income derived by individuals from the sale of digital assets is considered property income and is subject to a 10% capital gains tax on the difference between the selling and purchase price. Tax declarations are required.
- Mining: Cryptocurrency mining is legal in Kazakhstan but is also subject to regulation, including licensing requirements and mandates for miners to sell a significant portion (e.g., 50% or more) of their mined assets through AIFC-registered exchanges.
In summary, while Kazakhstan generally prohibits crypto circulation outside the AIFC, it has created a specific, regulated pathway for retail investors to legally trade cryptocurrencies through licensed exchanges operating within the AIFC's special economic zone. This makes the status "Allowed-Regulated" rather than "Restricted" or "Banned," as there is a clear, albeit geographically and operationally specific, legal avenue for participation.
3. Specific Relevant Text Excerpts:
- IMF (April 2024): "The circulation of many types of crypto assets are banned in Kazakhstan, and they are not allowed to be used for payments... The circulation of so-called unsecured digital assets is banned in Kazakhstan... except for the Astana International Financial Centre (AIFC)... A pilot project on crypto assets launched in the AIFC allows for the circulation of unsecured digital assets, with significant restrictions, but serves largely residents in Kazakhstan..."
- Gofaizen & Sherle (2025): "Contrary to the ban on the issue and circulation of unsecured digital assets in Kazakhstan, the legislation provides the possibility of their issue and circulation through the Astana International Financial Centre (AIFC) as an exception to the general rule. This will allow to legally conduct cryptocurrency activities on the territory of AIFC with the license 'Operating a Digital Asset Trading Facility'."
- Gofaizen & Sherle (2025): "Companies that have obtained a license for cryptocurrency in Kazakhstan will be able to legally provide services of purchase, sale, and exchange of cryptocurrencies in exchange for fiat money or another cryptocurrency... This activity will be supervised by The Astana Financial Services Authority (AFSA) – the main financial regulator on the territory of AIFC."
- Global Legal Insights (Sept 2024): "As of today, trading in cryptocurrencies and mining are permitted after obtaining an appropriate licence. Citizens can register on licensed exchanges without any complications or restrictions."
- Binance Square User Post (Jan 2025): "In Kazakhstan, it is legal to trade cryptocurrencies only on licensed AIFC exchanges... In addition, there are restrictions on the choice of crypto assets; trading can only be done with licensed AIFC currencies."
- Interfax (Oct 2024): "Kazakhstan's Agency for Regulation and Development of the Financial Market is planning to introduce new restrictions for banks requiring them to automatically deny payments and transfers to cryptocurrency exchanges not registered with the Astana International Financial Centre (AIFC)."
- LegalBison (Mar 2025): "In Kazakhstan, cryptocurrency activity is only legal within the Astana International Financial Center (AIFC). Every business willing to become a digital asset service provider in Kazakhstan should register with this independent entity. Otherwise, Kazakhstan outside of the AIFC does not allow for crypto businesses."
- White&Case (via IMF, April 2024): "The circulation of so-called unsecured digital assets... is banned in Kazakhstan. These are broadly akin to unbacked crypto assets (Bitcoin, Ether etc.), stablecoins (USDT, USDC etc.) and security tokens."
4. Source URLs:
- IMF Technical Note (April 2024): https://www.elibrary.imf.org/view/journals/007/2024/095/article-A001-en.xml (Note: Access may require subscription or institutional login, but key findings are summarized in the search results)
- Gofaizen & Sherle (Crypto License Info): https://gofaizen-sherle.com/crypto-license/kazakhstan
- Global Legal Insights (Fintech Law): https://www.globallegalinsights.com/practice-areas/fintech-laws-and-regulations/kazakhstan
- Binance Square (User Guide): https://www.binance.com/en/square/post/4675757187882
- Interfax (Banking Restrictions): https://interfax.com/newsroom/top-stories/106701/
- LegalBison (Crypto License Info): https://legalbison.com/crypto-license/kazakhstan/
- AFSA Rulebook Announcement: https://afsa.kz/fsa-announces-new-rulebook-on-digital-asset-activities/
- Prifinance (Crypto License Info): https://prifinance.com/en/crypto-licenses/exchange-license-in-kazakhstan
- Freedom Broker (Overview): https://kz.freedombroker.com/expert/analytics/cryptocurrency-in-kazakhstan-what-is-permitted-and-what-is-not
**Report: Retail Cryptocurrency Trading Status in Kazakhstan**
**Topic:** Retail_Trading_Status
**Description:** Assess whether individual citizens and residents in the country are legally permitted to buy, sell, and hold cryptocurrencies. Detail the regulatory environment surrounding this activity (e.g., KYC/AML requirements imposed on platforms, general warnings issued).
**1. Status:** `Allowed-Regulated`
**2. Detailed Narrative Explanation:**
Kazakhstan has adopted a distinct approach to cryptocurrency regulation, generally prohibiting the circulation and use of unsecured digital assets (like Bitcoin, Ether, and most stablecoins) as payment instruments within the main territory of the Republic of Kazakhstan. However, it has established a special legal regime within the Astana International Financial Centre (AIFC), a financial hub located in Astana (formerly Nur-Sultan).
* **General Prohibition with AIFC Exception:** The "Law on Digital Assets in the Republic of Kazakhstan," effective April 1, 2023, generally bans the issuance and circulation of unsecured digital assets and the operation of exchanges for such assets in Kazakhstan. However, it provides a specific exception for activities conducted within the AIFC.
* **AIFC Pilot Project and Regulation:** The AIFC, regulated by the Astana Financial Services Authority (AFSA), initiated a pilot project to allow interaction between AIFC-registered crypto exchanges and Kazakhstan's commercial banks. This project, initially set to end in 2022, has been extended. It allows for the circulation and trading of certain digital assets under specific conditions within the AIFC framework.
* **Retail Trading within AIFC:** Individual citizens and residents of Kazakhstan are permitted to buy, sell, and hold cryptocurrencies, but *only* through exchanges licensed by the AFSA and operating within the AIFC. This creates a regulated channel for retail participation.
* **Regulatory Oversight:** The AFSA oversees cryptocurrency activities within the AIFC. Companies operating digital asset trading facilities must obtain an AFSA license ("Operating a Digital Asset Trading Facility"). These licensed entities are subject to strict regulatory requirements, including robust Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) measures, customer identification (KYC) procedures, secure storage methods, and reporting obligations.
* **Restrictions:** While trading is allowed via licensed AIFC exchanges, there are limitations. Retail investors face restrictions on the types of crypto assets available (only those approved/licensed by AFSA) and potentially on the types of operations (e.g., P2P, futures trading, and certain yield-generating products like Binance Earn might be restricted on specific platforms operating under the AIFC license). There are also reports of potential investment limits for retail investors without proven knowledge/experience, although details might vary. Furthermore, recent proposals (October 2024) suggest banks will be required to block transfers to *unlicensed* (non-AIFC) foreign crypto exchanges and apply enhanced scrutiny for large transactions even with licensed AIFC entities.
* **Taxation:** Income derived by individuals from the sale of digital assets is considered property income and is subject to a 10% capital gains tax on the difference between the selling and purchase price. Tax declarations are required.
* **Mining:** Cryptocurrency mining is legal in Kazakhstan but is also subject to regulation, including licensing requirements and mandates for miners to sell a significant portion (e.g., 50% or more) of their mined assets through AIFC-registered exchanges.
In summary, while Kazakhstan generally prohibits crypto circulation outside the AIFC, it has created a specific, regulated pathway for retail investors to legally trade cryptocurrencies through licensed exchanges operating within the AIFC's special economic zone. This makes the status "Allowed-Regulated" rather than "Restricted" or "Banned," as there is a clear, albeit geographically and operationally specific, legal avenue for participation.
**3. Specific Relevant Text Excerpts:**
* **IMF (April 2024):** "The circulation of many types of crypto assets are banned in Kazakhstan, and they are not allowed to be used for payments... The circulation of so-called unsecured digital assets is banned in Kazakhstan... except for the Astana International Financial Centre (AIFC)... A pilot project on crypto assets launched in the AIFC allows for the circulation of unsecured digital assets, with significant restrictions, but serves largely residents in Kazakhstan..."
* **Gofaizen & Sherle (2025):** "Contrary to the ban on the issue and circulation of unsecured digital assets in Kazakhstan, the legislation provides the possibility of their issue and circulation through the Astana International Financial Centre (AIFC) as an exception to the general rule. This will allow to legally conduct cryptocurrency activities on the territory of AIFC with the license 'Operating a Digital Asset Trading Facility'."
* **Gofaizen & Sherle (2025):** "Companies that have obtained a license for cryptocurrency in Kazakhstan will be able to legally provide services of purchase, sale, and exchange of cryptocurrencies in exchange for fiat money or another cryptocurrency... This activity will be supervised by The Astana Financial Services Authority (AFSA) – the main financial regulator on the territory of AIFC."
* **Global Legal Insights (Sept 2024):** "As of today, trading in cryptocurrencies and mining are permitted after obtaining an appropriate licence. Citizens can register on licensed exchanges without any complications or restrictions."
* **Binance Square User Post (Jan 2025):** "In Kazakhstan, it is legal to trade cryptocurrencies only on licensed AIFC exchanges... In addition, there are restrictions on the choice of crypto assets; trading can only be done with licensed AIFC currencies."
* **Interfax (Oct 2024):** "Kazakhstan's Agency for Regulation and Development of the Financial Market is planning to introduce new restrictions for banks requiring them to automatically deny payments and transfers to cryptocurrency exchanges not registered with the Astana International Financial Centre (AIFC)."
* **LegalBison (Mar 2025):** "In Kazakhstan, cryptocurrency activity is only legal within the Astana International Financial Center (AIFC). Every business willing to become a digital asset service provider in Kazakhstan should register with this independent entity. Otherwise, Kazakhstan outside of the AIFC does not allow for crypto businesses."
* **White&Case (via IMF, April 2024):** "The circulation of so-called unsecured digital assets... is banned in Kazakhstan. These are broadly akin to unbacked crypto assets (Bitcoin, Ether etc.), stablecoins (USDT, USDC etc.) and security tokens."
**4. Source URLs:**
* **IMF Technical Note (April 2024):** [https://www.elibrary.imf.org/view/journals/007/2024/095/article-A001-en.xml](https://www.elibrary.imf.org/view/journals/007/2024/095/article-A001-en.xml) (Note: Access may require subscription or institutional login, but key findings are summarized in the search results)
* **Gofaizen & Sherle (Crypto License Info):** [https://gofaizen-sherle.com/crypto-license/kazakhstan](https://gofaizen-sherle.com/crypto-license/kazakhstan)
* **Global Legal Insights (Fintech Law):** [https://www.globallegalinsights.com/practice-areas/fintech-laws-and-regulations/kazakhstan](https://www.globallegalinsights.com/practice-areas/fintech-laws-and-regulations/kazakhstan)
* **Binance Square (User Guide):** [https://www.binance.com/en/square/post/4675757187882](https://www.binance.com/en/square/post/4675757187882)
* **Interfax (Banking Restrictions):** [https://interfax.com/newsroom/top-stories/106701/](https://interfax.com/newsroom/top-stories/106701/)
* **LegalBison (Crypto License Info):** [https://legalbison.com/crypto-license/kazakhstan/](https://legalbison.com/crypto-license/kazakhstan/)
* **AFSA Rulebook Announcement:** [https://afsa.kz/fsa-announces-new-rulebook-on-digital-asset-activities/](https://afsa.kz/fsa-announces-new-rulebook-on-digital-asset-activities/)
* **Prifinance (Crypto License Info):** [https://prifinance.com/en/crypto-licenses/exchange-license-in-kazakhstan](https://prifinance.com/en/crypto-licenses/exchange-license-in-kazakhstan)
* **Freedom Broker (Overview):** [https://kz.freedombroker.com/expert/analytics/cryptocurrency-in-kazakhstan-what-is-permitted-and-what-is-not](https://kz.freedombroker.com/expert/analytics/cryptocurrency-in-kazakhstan-what-is-permitted-and-what-is-not)