Kazakhstan ready to legalize crypto as Russians flock to the country

Kazakhstan is ready to legalize a mechanism for converting cryptocurrencies to cash if there is demand, said President Kassym-Jomart Tokayev, per local news agency Informburo on Sept. 28.

Speaking at the international forum Digital Bridge 2022, Tokayev emphasized that Kazakhstan aims to become an international leader in the field of digital technology, cryptocurrency ecosystem and regulated mining. He noted that the government of Kazakhstan has drafted amendments in national law to pilot a mechanism for converting crypto at the Astana International Financial Centre.

“We are ready to go further. If this financial instrument shows its further relevance and security, it will certainly receive full legal recognition,” Tokayev stated.

The country’s president reportedly visited a joint booth of the major local lender Eurasian Bank and the Intebix crypto exchange at the Digital Bridge 2022 event.

According to local reports, the Eurasian Bank and Intebix announced that they jointly completed the bank’s first regulated crypto purchase for fiat. The precedent has marked a major milestone in Kazakhstan’s crypto adoption, allowing the Kazakh people to legally buy crypto for the national currency tenge.

Other companies in the pilot crypto projects include crypto exchanges like ATAIX as well as Kazakhstan's largest bank, Halyk Bank and Altyn Bank.

The news comes as thousands of Russians enter Kazakhstan just a week after Russian President Vladimir Putin announced a partial mobilization of reservists to fight in Ukraine. On Sept. 21, Halyk Bank suspended the use of Russia’s Mir payment cards amid sanctions warnings by the United States Treasury Department.

​​Kazakhstan is not the only country that has emerged as a popular destination for Russians leaving the country and has been working to boost crypto adoption. Neighboring Georgia has also been moving to introduce new crypto regulations in order to become a global crypto hub.

Related: Russian officials approve use of crypto for cross-border payments

While countries like Georgia and Kazakhstan appear to welcome crypto alongside Russians fleeing mobilization, Europe has been growing increasingly concerned about Russians turning to crypto to access their money. After restricting Russian payments to European crypto wallets to 10,000 euros in April, the European Union now also reportedly plans to ban Russian nationals and entities from holding any assets in EU crypto wallets.

As previously reported, Russia has been largely relying on foreign crypto infrastructure to conduct cryptocurrency operations. The Bank of Russia has repeatedly argued that the country should not legalize any local crypto exchanges.