Uzbekistan Cracks Down on Unlicensed Crypto Exchanges

Uzbekistan Cracks Down on Unlicensed Crypto Exchanges
  • Just one cryptocurrency exchange in Uzbekistan has been granted a license so far.
  • Uzbek residents are urged by the NAPP not to utilize illegal exchanges.

According to data collected by the National Agency of Prospective Projects (NAPP) in Uzbekistan, the number of unlicensed online platforms offering crypto-related services to citizens of the country has increased. These, according to the regulatory authority, allow for the trading of cryptocurrencies and the collection of personal information without fulfilling the need that their servers to be located inside the nation.

The agency recently issued a statement:

“Do not bear any legal responsibility for carrying out operations with crypto assets, cannot guarantee the legitimacy of transactions, as well as the proper storage and confidentiality of the personal data of citizens of the Republic of Uzbekistan.” 

New Regulations Already in Effect

As a result of these discoveries, the authority has implemented domain access restrictions. The government of Uzbekistan has been working hard to strengthen the institutional and regulatory environment for cryptocurrencies, and this news emphasizes their efforts. Uzbek citizens and enterprises may only buy, sell, and trade cryptocurrencies on local exchanges beginning of January 1, 2023, according to new regulations established in April.

There is currently just one cryptocurrency exchange in Uzbekistan that has been granted a license. Uznex, which is run by the Kobea Group of South Korea, went live in the first month of 2020.

The regulator has also reminded citizens that they may buy and sell cryptocurrency on domestic exchanges using som, the national currency and that they can even trade crypto assets with overseas citizens for fiat cash. Uzbek residents are urged by the NAPP not to utilize the services of online platforms that have not secured a license to operate in the republic and to instead report them to the appropriate authorities.

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