It’s not uncommon for governments to shut down illegal crypto exchanges and the latest trading platform to have a similar fate is ABS Change.
ABS Change is a trading platform for cryptocurrencies that was operating without a license in Kazakhstan.
Additionally, the entity was found to be in possession of cryptocurrency assets worth thousands of dollars, stored in two wallets on Binance. As per the news, these wallets have temporarily been suspended.
Kazakh Authorities Bust Illegal Crypto Exchange
After having increased its surveillance over crypto-related activities, Kazakh Authorities discovered ABS Change, which has illegally been operating as a crypto trading platform.
The Authorities have reportedly appropriated from the crypto exchange an amount which is above $350,000.
Further inquiry into the trading platform showed that it had purportedly conducted transactions of approximately $34 Million.
These dealings worth $34 million were done using digital asset wallets on Binance. Two of the Binance digital wallets on the illegal trading platform have already been blocked.
Such an action has been taken by the authorities in order to prevent further illegalities from being carried out.
It was Kazakhstan’s Financial Monitoring Agency (FMA) that had hunted down the illegal exchange and shut it down.
This shows that government departments have become more proactive in cracking down on these crypto trading platforms.
Financial Monitoring Agency
The FMA is a government body in Kazakhstan that regulates activities for money laundering and terrorism financing.
Crypto is often seen as a means to do money laundering and therefore, FMA keeps a close watch on activities related to it.
It is authorized to oversee financial transactions in the country and is regulated by the National Bank of Kazakhstan.
The FMA is responsible for maintaining the stability and reliability of the financial institutions in Kazakhstan.
Criminal activities and financial crimes can bring a bad name to a country and can damage its security and economy.
The FMA is entrusted with the responsibility to prevent any such harm or damage from happening. The FMA has been keeping up with this duty and hence the crackdown on illegal crypto trading platforms.
According to the government authority, the functions of ABS Change were being carried out beyond the jurisdiction of Astana International Financial Center (AIFC).
It is only crypto trading platforms that are housed within the jurisdiction of AIFC are allowed to offer crypto trading services. Those outside the financial hub don’t have any such authority or license.
Kazakhstan’s Growing Crypto Economy and Trading Platforms
In recent years the crypto market in Kazakhstan has been growing slowly and steadily.
With this, the government has shown a keen interest in the potential of cryptocurrencies, trading platforms, digital asset exchanges, and blockchains.
The AIFC was founded some five years back in 2018 to operate as a center for financial innovation. Since then it has become home to numerous cryptocurrency trading platforms and exchanges.
The FMA on the other hand has been attentively combating illicit gray business activities which include those taking place in the cryptocurrency realm.
As per the agency, there was a reduction to 20% of the shadow economy in the country.
The regulating authority has successfully taken down multiple unlawful and illegal crypto trading websites and platforms since the start of this year.
In one such unlawful operation, a Russian individual had invested approximately $188,000 worth of assets which included digital assets.
Countries have now started taking a firm stance on illegal crypto trading activities.
Earlier governments were wary of handling this decentralized token, however, now that it’s becoming common, governments are devising a mechanism to regulate it.
It was probably China’s crackdown that resulted in an increased inflow of crypto investors in Kazakhstan. The country has cheap electricity and therefore, becomes an attractive hub for crypto miners.
The generation of cryptocurrency requires electricity and therefore, a cheap electric supply is the biggest incentive. Due to this fact Kazakhstan is becoming a popular source of crypto mining.
It is thus imperative that the government of Kazakhstan devise a distinct mechanism along with proper regulations for the same.