Monument for Manas, hero of ancient Kyrgyzstan epoch
Monument for Manas, hero of ancient Kyrgyzstan epoch, together with national Kyrgyzstan flag in Bishkek, Kyrgyzstan. Shutterstock

The National Bank of Kyrgyzstan has published draft legislation that would regulate the crypto industry in the country.

According to an explanatory note published on 31 December 2020, the legislation is set to establish a clear definition of cryptocurrencies and propose ways they can be used in the country.

The National Bank acknowledged that Kyrgyz citizens have become increasingly interested in cryptocurrencies as a means of investment. The bank said it was imperative to establish laws that would protect both consumer and investor rights, as cryptocurrencies have begun penetrating traditional financial structures.

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Under the new proposal, cryptocurrency exchanges would need to be licensed by the National Bank and taxed the same way as foreign exchange brokers. Exchanges will be required to keep records of all of the transactions they facilitate and provide them to the National Bank upon request.

The draft law also bans any legal entities and individual entrepreneurs from participating in cryptocurrency trading. Only individuals, exchange operators, and cryptocurrency miners will have the right to buy and sell cryptocurrencies.

First announced in November 2020, the draft law is yet to be introduced to the Kyrgyzstan parliament for discussion.

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