Kazakhstan has shut down 130 illegal crypto exchanges suspected of laundering criminal proceeds and seized virtual assets worth $16.7 million.
According to a report by The Times of Central Asia, only crypto exchanges licensed by the Astana Financial Services Authority and integrated with local banks are permitted to operate in accordance with the Law on Digital Assets.
Platforms operating without such authorization are deemed illegal and targeted for termination.
The crackdown extends beyond exchanges, with authorities uncovering 81 shadow cash-out groups, which had a combined turnover of 24 billion KZT ($43 million) in 2024.
Deputy Chairman of the Financial Monitoring Agency (AFM) Kairat Bizhanov emphasized that ATMs remain a critical vulnerability despite measures taken, with cash withdrawals totaling 13.2 trillion KZT ($24.1 billion), one trillion more than last year.
Anonymous transactions conducted using bank cards issued to nominal owners enable criminals, including cyber fraudsters and drug traffickers, to operate without identifying senders or recipients.
The enforcement comes as Kazakhstan positions itself as Central Asia’s blockchain hub while maintaining strict oversight.
The country launched Alem Crypto Fund as its first national crypto reserve on September 30, selecting BNB as the initial digital asset through a partnership with Binance Kazakhstan.
The fund, established by the Ministry of Artificial Intelligence and Digital Development, aims to become “a reliable instrument for major investors and a key foundation for digital state reserves.”
New Regulations Target Anonymous Cash Transactions and Shell Companies
The AFM and National Bank of Kazakhstan introduced regulations requiring card top-ups exceeding 500,000 KZT ($913) to input individual identification numbers and confirm via mobile applications.
Since January 1, banks must retain ATM camera footage for at least 180 days. Authorities plan to expand biometric identification, including facial and fingerprint recognition, for all cash transactions.
In cooperation with the Ministry of Justice and the Ministry of Artificial Intelligence, the AFM drafted amendments to tighten business registration protocols.
The focus centers on verifying company founders and executives based on risk criteria following a surge in fictitious companies used for money laundering and financial fraud.
In the last three years, tax authorities have canceled the registration of 3,600 shell companies associated with 30,000 fraudulent transactions, totaling 280 billion KZT ($511 million).
The enforcement followed earlier actions in 2024, when regulators closed 36 illegal crypto exchangers with a total turnover of 60 billion tenge ($112 million).
Just this year, the AFM, along with the National Security Committee and the Ministry of Culture and Information, blocked over 3,500 illegal online crypto exchanges while exposing two financial pyramids that utilized cryptocurrency to attract investments.
Authorities returned 545,000 Tether and froze 120,000 USDT during these operations.
Balancing Innovation With Oversight as Crypto Adoption Doubles
Kazakhstan approved stablecoin payments for regulatory fees in September during Astana Finance Days, with Bybit becoming the first exchange to sign a multilateral Memorandum of Understanding with AFSA.
The framework allows AIFC participants and registration applicants to settle fees in U.S. dollar-pegged stablecoins through licensed Digital Asset Service Providers acting as payment agents.
Little before then, President Kassym-Jomart Tokayev unveiled “CryptoCity” during the Astana International Forum 2025, a pilot zone in Alatau where cryptocurrencies can be used for everyday payments as a regulated sandbox.
The proposed crypto banking system will provide exchange, storage, and transaction processing services while supporting anti-money laundering compliance.
The country is developing the digital tenge, a central bank digital currency, with a full rollout scheduled for the end of 2025.
Earlier in August, Kazakhstan launched Central Asia’s first spot Bitcoin ETF, with the Fonte Bitcoin ETF trading on the Astana International Exchange.
The physically backed fund, managed by Fonte Capital, uses BitGo Trust for cold storage custody.
National Bank Chairman Timur Suleimenov confirmed plans to channel portions of Kazakhstan’s gold and foreign exchange reserves, along with National Fund assets, into crypto-linked investments following strategies used by sovereign wealth funds in Norway, the U.S., and the Middle East.
The country also launched the Solana Economic Zone Kazakhstan in June, marking the first Web3-focused economic zone in Central Asia.
The initiative is built on the Solana blockchain and backed by the Solana Foundation, serving as a sandbox for emerging Web3 projects.
It offers pilot programs in tokenized capital markets, talent development, and startup support.
As part of the program, a nationwide program focused on Rust programming and blockchain engineering will partner with local universities to train developers.
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