Last Updated on December 25, 2019
In a recent report, Uzbekistan has banned blockchain companies from holding, selling, or buying cryptocurrency for its citizens. This ban will also include crypto purchases from licensed blockchain and cryptocurrency exchanges.
Licensed companies also included in the ban
According to the report, Usbekistan citizens are henceforth banned from purchasing cryptocurrency-related instruments in the country.
The ban did not spare anyone. Even those licensed cryptocurrency companies are also involved in the ban. According to the report, the ban affects even companies who are completely licensed to carry out cryptocurrency-related transactions in the country. Based on this recent development, all licensed companies may short down their operations in the country indefinitely.
Investors allowed to sell-off their cryptocurrencies
In compliance with the ban, the Uzbekistani regulatory body had asked holders of any cryptocurrency to sell them legally through Sputnik and Forklog, which are two dully registered crypto exchange platforms in the country.
Now, no citizen is allowed to hold or trade them after selling them off this period, the regulator announced.
Youtube, the largest video sharing portal in the world, recently deleted so many cryptocurrency-related videos from channels streaming cryptocurrency videos in Uzbekistani. The platform also asked them to stop creating such videos in the future.
Uzbekistan was one of the crypto-friendly countries in the world. However, recent development means it has completely turned against the business of cryptocurrency in the country. It means that every business related to cryptocurrency shall henceforth cease to operate. It has also put policies in place to deal with violators.
Nature of cryptocurrency could pose a problem
Some stakeholders have pointed out that the nature of cryptocurrency business could pose a problem towards the effective adherence to the law. They explained that with the help of virtual private networks (VPN), digital assets could be effectively bought and sold anywhere in the world. According to them, this is one area where the law may find difficult to overcome. They also argued that it’s very difficult to track down the violators because of the decentralized nature of cryptocurrencies.
A radical change against cryptocurrency
Uzbekistan used to be a very favorable environment for cryptocurrency. Before this ban, the government of Uzbekistan was crypto-friendly, which caused a quantum leap in crypto-related businesses in the country.
Last year, the Uzbekistani government made crypto trading legal in the country. To make the industry legal, it introduced the licensing of digital asset exchanges. The government even went as far as giving tax incentives to crypto holders in a bid to encourage the business in the country.
Besides, licensed companies are not subject to any foreign currency regulations. This made the country a very attractive environment for crypto traders and crypto-related firms.
But it seems all these have changed as the Uzbekistani government is now playing a different drum. Now with the passage of the law, the country is a prohibited area for cryptocurrency business. No one is allowed to hold or trade in the currency, not even the previously licensed cryptocurrency companies in the country.