Kazakhstan liquidated 36 crypto exchanges with $100 million turnover and seizes $4.8 million USDT

Kazakhstan intensified its crackdown on illegal crypto exchanges in 2024, targeting platforms linked to money laundering activities.

According to a press statement, the Asian country’s Financial Monitoring Agency (AFM) announced that it liquidated 36 unauthorized exchanges with a combined turnover of more than $100 million and restricted access to over 3,500 unregistered crypto trading platforms.

Money laundering concerns

The AFM’s actions stem from growing concerns over the misuse of unregulated exchanges for criminal activities such as cyber fraud and drug trafficking. Many of these platforms lacked anti-money laundering (AML) measures and know-your-customer (KYC) protocols, making them attractive tools for illicit transactions.

In a collaborative effort with the National Security Committee and the Ministry of Culture and Information, authorities seized $4.8 million in USDT and dismantled two crypto pyramid schemes. This operation recovered an additional $545,000 USDT and froze $120,000 USDT.

To strengthen its stance against financial crimes, Kazakhstan introduced legislative amendments that hold digital asset providers accountable for AML violations. These amendments include enhanced verification protocols for crypto transactions within financial institutions.

Kazakhstan’s measures reflect its growing focus on regulating the crypto sector and combating the exploitation of digital assets for illegal purposes. The AFM also plans to collaborate with international partners to expand efforts to address criminal activities linked to cryptocurrencies.

Kazakhstan’s crypto relationship

Kazakhstan was once a larger player in the crypto industry, particularly after China’s 2021 crackdown on crypto mining led to an influx of miners. This situation resulted in the country briefly ranking as the world’s second-largest Bitcoin producer.

However, stringent regulations have since caused an exodus of miners, with the country now contributing less than 5% of the global Bitcoin network hashrate.

Despite these changes, local interest in digital assets has grown. A report revealed that the number of Kazakhstani residents owning cryptocurrencies had doubled in the past year, signaling a continued interest in the evolving digital economy.