• Kuwait has banned crypto payments, investments, and mining to comply with money laundering prevention regulations set by the FATF.
• The Capital Markets Authority issued a circular stating that companies are not allowed to provide any type of crypto-related services.
• Citizens were warned of the risks associated with volatile encrypted currencies that do not have legal status.

Kuwait Cracks Down on Crypto

Banning Payments, Investment and Mining

The Capital Markets Authority in Kuwait has prohibited the use of cryptocurrency for payments or investment in order to combat money laundering as per requirements set by the Financial Action Task Force (FATF). Besides this, all digital asset mining activities have been completely banned and cryptocurrency is not recognized as decentralized currency either.

Exemptions from Prohibition

The circular issued by the CMA also stated that securities regulated by the Central Bank of Kuwait and other securities and financial instruments regulated by the Capital Markets Authority are exempted from this prohibition.

Purpose Behind Prohibitions

The purpose behind these prohibitions is to come into compliance with FATF’s global recommendations for cryptocurrencies. This followed a study into the sector conducted by the National Committee for Combating Money Laundering and Financing of Terrorism.

Warning to Citizens

Citizens were warned about risks associated with volatile encrypted currencies which do not have any legal status. Any violations of these prohibitions will result in penalties being imposed on those involved.

Conclusion

Although countries are required to put up guardrails for preventing money laundering, it should be noted that FATF has not asked countries to ban cryptocurrency altogether.