Kazakhstan’s financial watchdogs have intensified their campaign against illegal cryptocurrency operations, shutting down 130 unlicensed exchanges and confiscating roughly $16.7 million in digital assets. The sweeping enforcement effort comes as part of the country’s broader mission to curb money laundering, tax evasion, and other illicit financial activities linked to digital currencies.
According to a report by The Times of Central Asia, Kairat Bizhanov, Deputy Chairman of the Financial Monitoring Agency (AFM), revealed that these exchanges had been handling criminal funds and aiding in the conversion of cryptocurrencies into cash through underground networks. Investigations uncovered 81 such operations that collectively processed over 24 billion KZT, equivalent to more than $43 million.
The AFM’s findings underscore how crypto-related cash withdrawals have become a growing issue in Kazakhstan’s financial system. In 2024 alone, withdrawals through ATMs amounted to 13.2 trillion KZT ($24.1 billion)—a trillion higher than the previous year. Many of these transactions were made using bank cards registered under fake identities, enabling untraceable fund transfers between anonymous users.
Over the past three years, the government has been clamping down on fraudulent entities to restore integrity to the financial ecosystem. Tax authorities have deregistered 3,600 shell companies tied to approximately 30,000 false transactions, collectively worth more than $500 million.
In response to these persistent challenges, Kazakhstan has rolled out stricter rules to strengthen oversight and traceability within its banking and crypto sectors. Card top-ups exceeding 500,000 KZT ($913) will now require users to provide an identity verification number (IIN), while banks must keep ATM surveillance footage for at least six months. Authorities are also moving toward the integration of biometric checks—including facial and fingerprint recognition—for all cash withdrawals to further reduce anonymity in financial dealings.
Beyond enforcement, Kazakhstan is taking steps to formalise and advance its crypto ecosystem. The National Bank is set to establish a state crypto reserve through a subsidiary focused on alternative investments. This reserve will manage digital currencies obtained through seizures or state mining activities and will form part of a broader strategy to incorporate blockchain technologies into the national economy.
The government’s dual approach—combining firm regulation with structured innovation—signals its intent to transform Kazakhstan into a more transparent yet forward-looking crypto hub in Central Asia.
