Kuwait’s Capital Markets Authority (CMA) recently issued a circular prohibiting almost all operations involving cryptocurrencies such as Bitcoin (BTC). The announcement stated that any commercial business providing virtual asset services must not be issued a license and customers must be aware of the associated risks.
In addition, this absolute prohibition does not apply to securities and other financial instruments regulated by Kuwait’s Central Bank and CMA. The CMA also noted the penalties for violating Kuwait’s Anti-Money Laundering laws as stipulated in the Article (15) of Law No. 106 of 2013.
This effort to restrict cryptocurrency operations is reportedly part of a joint inter-departmental initiative that involves several supervisory authorities, such as the Central Bank of Kuwait, the Ministry of Commerce and Industry, and the Insurance Regulatory Unit.
The CMA warned of the lack of legal status and support for cryptocurrencies and highlighted the price fluctuations of such assets due to speculation. It concluded the statement by urging customers to be cautious in dealing with virtual assets.
These restrictions in Kuwait come as part of the country’s attempts to combat money laundering and terrorist financing, following the Financial Action Task Force’s Recommendation (15).
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