Kyrgyzstan may well be on its way to regulating the digital currency industry. The country’s central bank has proposed the drafting of regulations for the industry which could finally give legal recognition to digital currencies.
In a statement, the National Bank of the Kyrgyz Republic revealed that it was analyzing the impact of digital currency regulations and inviting stakeholders’ proposals.
“The purpose of the proposed regulation is to create favorable conditions for the development of new technologies in the market, minimize the relevant risks, and protect consumer rights,” the bank stated.
Some of the benefits that the bank expects from the regulations include stimulating the development of innovative technologies, reducing the risk of fraud, terrorism financing and money laundering as well as protecting the rights of investors and consumers. The bank also expects the government to gain more taxes from the industry.
The bank is aware that the digital currency industry is harder to regulate than other emerging technologies, the statement said. This is mainly because of their cross-border nature which makes it more difficult for one jurisdiction to police the industry.
In its request for public participation on the process, the bank listed some of the key areas the citizens must consider as they submit their views. They include whether the country needs to regulate the industry, what goals they want the regulations to achieve, risks that may arise from the regulations, other alternatives to regulations and what benefits they expect from a regulated digital currency industry.