Crypto license in Kazakhstan

Over the past five years, Kazakhstan’s legislation regulating activities in the field of cryptocurrencies has changed. In 2018, the Law “On Amendments and Additions to Certain Legislative Acts of the Republic of Kazakhstan on Financial Regulation” was adopted, amending the Law “On the Securities Market,” the Law “On the National Bank of the Republic of Kazakhstan,” and other legislative acts.

The National Bank acted as the regulator of the cryptocurrency market and issued licenses based on a number of requirements and standards, such as sufficient capital, compliance with anti-money laundering (AML) and counter-terrorist financing (CTF) requirements, the use of secure methods for storing cryptocurrencies, and others.

In 2020, Kazakhstan adopted the Law on Digital Financial Assets, which regulates the use and circulation of digital financial assets, including cryptocurrencies, and establishes the procedure for their regulation and supervision.

Since April 1, 2023, the Ministry of Digital Technologies of Kazakhstan has been issuing licenses for cryptocurrencies. This allows companies to legally conduct activities related to cryptocurrencies within the AIFC.

The Astana International Financial Center (AIFC) is a territory in the city of Nur-Sultan (formerly Astana) designated by the President of the Republic of Kazakhstan. It is subject to a special legal regime in the field of finance established by the Constitutional Law of the Republic of Kazakhstan “On the Astana International Financial Center.”

The main regulator in the AIFC jurisdiction is the Financial Services Agency (AFSA). It was established on January 1, 2018, as an independent regulator within the AIFC. The main task of the AFSA is to regulate financial services and related operations carried out in the Astana International Financial Center.

AFSA regulates both financial and non-financial services. The regulator supervises the activities of the Center’s participants, providing financial and related services, as well as activities in the capital markets within the IFCA.

Institutions registered and licensed by AFSA are referred to as “Center Members.” To become a member, it is necessary to have a physical presence in the IFCA, but services may be provided to clients throughout the country by AFSA rules. Members may also operate outside Kazakhstan but are required to comply with the laws of that country.

AFSA supervises and authorizes all Center members, their directors, and key employees (hereinafter referred to as “Authorized Persons”) to perform controlled functions. If necessary, AFSA may take enforcement measures against Center participants.

Legislation on cryptocurrency licensing in Kazakhstan

The legislative framework for the crypto business in Kazakhstan has been developed gradually, starting with the first amendments in 2018, when provisions affecting digital assets were introduced into financial legislation, including the Law on the Securities Market and the laws on the National Bank. These changes did not provide comprehensive regulation, but they did establish the role of the National Bank as the authority responsible for supervising operations and ensuring compliance with anti-money laundering and counter-terrorist financing measures.

Clearer rules came in 2020 with the Digital Financial Assets Act, which officially defined digital financial assets, set out how they should be used, and oversees their circulation. The role of the MCA was also outlined, but licensing wasn’t centralized or mandatory.
Today, the key regulatory act is the Law of the Republic of Kazakhstan “On Digital Assets”, which came into force on April 1, 2023. It established the legal framework for the issuance, circulation, and regulation of digital assets, including:

• mandatory licensing of companies working with digital assets;
• requirements for reporting by crypto exchanges and mining companies;
• state control over the issuance, circulation, and storage of digital assets.

In addition, the registration of hardware and software complexes for mining is regulated separately.

The law defines a digital asset as property created in electronic form with an assigned digital code, secured by the immutability of information using distributed platform technologies. The document distinguishes between secured and unsecured digital assets. The former certify rights to tangible and intangible assets (except for money and securities), while the latter are rewards for participating in maintaining consensus in the blockchain and can be traded on digital asset exchanges.

Activities in the field of digital assets are strictly regulated. To issue secured digital assets, individuals and legal entities must obtain permission from the authorized body and are subject to financial monitoring by anti-money laundering and counter-terrorist financing legislation. State inspectors monitor compliance with the rules by the procedure established by the Entrepreneurial Code.

Mining is only permitted with a license. Licenses are issued for three years to legal entities with their infrastructure and those who rent premises on crypto farms. Digital mining pools are also subject to separate registration and must comply with the requirements for equipment and software in Kazakhstan, information security, and accreditation rules.

Transactions with digital assets mined in the country are conducted exclusively through licensed exchanges operating under the jurisdiction of the Astana International Financial Center (AIFC). At the same time, the law establishes the mandatory sale of a portion of the mined assets:

• from January 2024 to January 2025 — at least 50%;
• from January 2025 — 75%.

The issuance and circulation of unsecured digital assets is prohibited within the country, except in the AIFC zone.

In addition, on February 6, 2023, Law No. 194-VII was signed, which supplements the legislation on the regulation of electricity for miners. It introduces energy consumption quotas, allows only surplus energy from the national grid to be used, but does not restrict miners operating on renewable sources, imported energy, or their generation. This law came into force on July 1, 2023, and details the rules for digital miners, making the legislation more comprehensive.

Licensing and registration

In Kazakhstan, activities involving digital assets are strictly regulated, and to operate in this market, it is necessary to either obtain a license or undergo state registration. The government offers different types of licenses to cover all key aspects of the crypto industry. The most popular ones are:

• crypto exchange license — allows companies to operate platforms for trading both cryptocurrencies and fiat money;
• crypto broker license — for companies that act as intermediaries in cryptocurrency transactions;
• mining license — for companies engaged in cryptocurrency mining;
• cryptocurrency trading license — for those who are directly involved in the purchase and sale of digital assets.

In addition, virtual asset service providers (VASPs) that provide a wide range of services with cryptocurrencies are also required to obtain a special license.

Cryptocurrency exchanges, platforms for issuing and exchanging secured digital assets, and digital asset storage service providers must undergo state registration. Registration allows for the identification of entities subject to financial monitoring and ensures transparency in digital asset transactions.

Licensed entities are required to comply with anti-money laundering and counter-terrorist financing requirements. This includes customer identification (KYC), reporting to regulatory authorities, and internal financial control procedures.

Licenses are issued for a fixed term (up to 5 years) with the possibility of renewal, subject to compliance with all legal requirements. In case of violations, the license may be suspended or revoked.

Register of crypto companies

AFSA maintains a public register of licensed crypto companies operating in the AIFC. It separately lists digital asset service providers, indicating their type of activity, date of license issuance, composition of the board of directors, capital size, and legal address.

The register is regularly updated and serves as a market transparency tool, allowing all participants to see which companies are authorized to work with cryptocurrencies in Kazakhstan and within what framework they can operate.