The government of Uzbekistan, a Central Asian nation, has banned access to two major cryptocurrency exchanges, namely FTX and Binance, under its jurisdiction. The main reason for the ban is that the state wishes to discourage cryptocurrency exchanges that are not registered within the region and hail from an outside source. To this end, the banned exchanges are directed to apply for an operating registration from the Uzbek government.
Recently, the Uzbek authorities have noticed that several cryptocurrency organizations in the region are operating without any approval or permit. To this end, the two biggest cryptocurrency platforms, such as Binance and FTX, have been banned. The government authorities are trying to set a precedent for cryptocurrency organizations to comply with the regulatory guidelines.
Binance is no stranger to getting in trouble with the governments and regulatory agencies around the world. The Chief of Eastern European Operations of Binance, Gleb Kostarev, has recently come forward to talk about the ban in the Uzbek region. The executive claimed that Binance services have been out of order and unreachable for Uzbek consumers since Tuesday.
He also clarified that other cryptocurrency exchanges such as Huobi, Bybit, FTX, and others are also facing the same issues. As far as compliance with the regulations in the country is concerned, there is only one registered cryptocurrency exchange platform in the region that is called Uznex. Uznex is a project of Kobea Group hailing from South Korean.
Foreign Cryptocurrency Exchanges have to Comply with Crypto-related Laws
In many regions of the world, the issue is the absence of proper regulatory guidelines for cryptocurrency organizations. However, it seems like Uzbekistan is dealing with the lack of compliance as a bigger problem. The National Agency of Prospective Projects or NAPP in Uzbekistan has recently reported an exponential increase in the number of unregistered cryptocurrency platforms in the country.
Under the latest directive from the Uzbek President, the government agencies are now working on creating a regulatory framework for Bitcoin in the light of statutory prosecution. The state has been working on creating legislative clarity for virtual assets since 2018. By 2023, only licensed or local cryptocurrency organizations will be able to operate in the region as per the latest mandate of the government.