Uzbekistan is blocking foreign crypto exchanges that are operating from outside the country and not registered under their authorities. This doesn’t mean that they are anti-crypto or are going to ban other platforms. It’s just that the authorities want the citizens to use exchanges that are licensed and approved by them. This will ensure that users are safe and that a foreign company does not embezzle their funds.
Uzbekistan wants to promote local and registered crypto exchanges
The authorities have made it necessary for platforms to have a license in order to offer crypto services to the users. However, lately, they have been seeing that many exchanges are offering their services without their approval/licenses. This means these platforms are storing user data and personal information on servers that are located outside their nation. Therefore, they are taking steps to stop exchanges operating from outside the country from operating in Uzbekistan.
Agency responsible for handling the matter said that such platforms do not have any legal responsibility for offering crypto services. At the same time, there is no guarantee or safety mechanism for user funds, personal information, and data. So, they must also understand that the steps Uzbekistan’s authorities are taking are for the benefit of the crypto investors.
The country has been proactive about crypto regulation
Since 2018, Uzbekistan has been regulating cryptocurrencies and is making serious efforts to improve its framework. They have made it compulsory for crypto exchanges, mining companies, and custody providers to have licenses in order to operate in the country. This gives the government control over companies that operate in Uzbekistan and also ensures that user safety is prioritized.
For now, the law for not allowing foreign platforms in the country has’t been completely implemented. Citizens of the country aren’t allowed to use anything other than domestic or licensed platforms for their trading activities from Jan 1, 2023. Till then, there is a gray area of whether the citizens can use international exchanges or not.
The only problem with this approach is the lack of options among the citizens. The authorities have approved only one platform till now. It is a South Korean exchange called Uznex.
What are your thoughts as Uzbekistan is blocking foreign crypto exchanges from operating without licenses? And do you think it will be enough to protect user security? Let us know in the comments below. And, if you found our content informative, do share it with your friends.