The government of Uzbekistan has moved to expand its crypto regulations through a decree signed by President Shavkat Mirziyoyev. The document provides definitions of terms such as crypto assets, exchange, and mining, and determines the primary regulator of the industry.
An agency headed by President Mirziyoyev to oversee the crypto market in Uzbekistan
The Uzbek head of state, Shavkat Mirziyoyev, signed a new decree expanding the Central Asian nation’s crypto space regulatory framework. Its stated objective is to further develop digital technologies, create favorable conditions for entrepreneurship and improve legislation in this area.
The National Agency for Project Management under the President has been transformed into the National Agency for Perspective Projects, Forklog reported, citing the document. the NAPP will become the country’s leading crypto watchdog.
The regulatory body was tasked with implementing state policy in the crypto-economy and ensuring the protection of investors’ rights. He will also be responsible for bringing blockchain technologies to the public sector and combating money laundering, terrorist financing, and weapons proliferation through cryptocurrencies.
The executive order defines crypto-assets as property rights representing a collection of digital records in a distributed ledger that have value and an owner. From January 1, 2023, Uzbek citizens and businesses will be allowed to buy, sell and trade cryptocurrencies through crypto service providers.
The president’s order lists a number of entities that fall into this category, including digital asset exchanges, mining pools, crypto custodians, and crypto stores. They will need to register as local businesses and obtain mining licenses or certificates from the government agency.
Uzbekistan legalized crypto trading in 2018, but in late 2019 the government banned local residents from buying cryptocurrencies. They could only sell. In November 2021, citizens were allowed to trade crypto assets for domestic currency on licensed domestic crypto exchanges, while non-residents were allowed to trade digital coins for foreign fiat.
Executive Order Prohibits Unauthorized Mining and Minting of “Anonymous” Cryptos
Only registered companies will be able to mine cryptocurrency in Uzbekistan. Mining farms will pay a higher electricity rate during peak consumption hours. Unauthorized mining will be prohibited. The ban also applies to the minting of what the decree calls “anonymous cryptocurrencies” and any transactions with them.
As before, Uzbeks will not be allowed to use or accept cryptocurrencies as payment for goods and services in the country. On the bright side though, crypto-related transactions by individuals and businesses will not be subject to tax, according to the document dated April 27, 2022.
Tax breaks will also be granted to participants in a new regulatory sandbox that NAPP will establish to pilot crypto projects. Entities involved in testing will also be exempt from other obligations to the state budget, including customs payments other than duties on imported hardware and software.
What do you think of Uzbekistan’s new crypto regulations? Let us know in the comments section below.
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