With the growing adoption of the cryptocurrency industry, illegal schemes are beginning to be more rampant than ever before. Kazakhstan’s Financial Watchdog, in the latest news, discovered five unlicensed cryptocurrency exchanges operating outside the law.
Per a report, The Financial Monitoring Agency (FMA) of the Republic of Kazakhstan seized documents, computer equipment, and cryptocurrency wallets related to these unlicensed platforms located in the northern part of the country.
The authorities have dismantled the group behind the platforms, and according to a press release, the FMA employees confiscated several laptops, cell phones, and flash memory sticks, as well as banking and accounting documents, during the searches carried out at six locations in the Kostanay region.
Kazakhstan’s Financial Authority Hunt Down
Reportedly, the organizers of the unlicensed exchanges – kzobmen.com, 1wm.kz, kazobmen.ru, wm007.kz, and kz-exchange.com reportedly acquired “especially large-scale” of income which was not specified from the business operation.
Though the FMA did not reveal the number or identities of people involved in the group behind these platforms, the authorities disclosed that these people were making use of Binance, the world’s largest crypto exchange, with a combined balance of $6,000 in digital assets.
As of now, the wallets with the funds are currently inaccessible as it has been temporarily restricted. More than $200,000 worth of coins were found in wallets with other exchanges, the FMA said. At the end of the note, the financial watchdog mentioned that these types of crypto services are only permitted under the special legal regime of the Astana International Financial Center (AIFC).
Kazakhstan’s Focus On Crypto Regulation
A pre-trial investigation into the case is still ongoing. Meanwhile, the Kazakhstan government has since been interested in regulating the crypto market. Early last year, the Kazakhstan government sanctioned 106 crypto-mining farms for engaging in illicit crypto-mining activities.
As reported by Bitcoinist, some ex-officials and Kazakhstan’s wealthiest businesses were found to be involved in the scheme. Additionally, approximately 67,000 pieces of equipment valued at around 100 billion tenges, or $193 million, were also seized.
Due to the infant stage, the crypto industry is currently at, regulation on the market has proved to be genuinely necessary. In 2022, Binance signed a Memorandum of Understanding with Kazakhstan’s Ministry of Digital Development, Innovations, to aid the Kazakhstan government in its measures to regulate the country’s cryptocurrency market.
Despite the cryptocurrency market’s starvation for regulation, investors are still interested in the industry, putting large amounts of funds into various cryptocurrency assets. The global cryptocurrency market capitalization is beginning to move above $1 trillion.
In the past 7 days, the global crypto market capitalization has moved from $1 trillion to $1.08 trillion at the time of writing, following BTC’s 11% rally over the same period.