In a decisive move to counter money laundering and financial risks, Kuwait’s Capital Markets Authority (CMA) has introduced a comprehensive ban on cryptocurrency usage. The new regulations, which were announced recently, impose an “absolute prohibition” on the use of digital currencies for making payments or investments within the country.
The CMA’s notification categorizes all virtual assets, including cryptocurrencies, as illegal for transactions. Moreover, the ban extends to digital asset mining, rendering such activities strictly prohibited. The regulator firmly states that it does not recognize cryptocurrencies as decentralized currencies, and consumers are reminded that businesses are prohibited from providing any services related to cryptocurrency.
The ban stems from circulars jointly issued by the Central Bank of Kuwait, the Capital Markets Authority, the Ministry of Commerce and Industry, and the Insurance Regulatory Unit. These circulars aim to supervise and control the use of virtual assets as payment tools or decentralized currencies within Kuwait. The decision aligns with Recommendation No. 15 issued by the Financial Action Task Force (FATF), emphasizing Kuwait’s commitment to combat money laundering and terrorism financing.
As per the CMA, the ban excludes securities regulated by the Central Bank of Kuwait and other financial instruments regulated by the Capital Markets Authority from the prohibition. However, any services related to virtual assets as a means of investment are strictly forbidden, with no previous licenses issued in this regard. This measure is part of Kuwait’s concerted efforts to adhere to international standards and combat financial crime effectively.
