Kazakhstan's president leads push for national crypto reserve

Kazakhstan needs to focus on cryptocurrencies and create a strategic reserve with the most promising among them, its president demanded as he instructed relevant institutions to work in that direction.

Kassym-Jomart Tokayev also urged speeding up the development of a comprehensive ecosystem for digital assets in the Central Asian country and investing millions of U.S. dollars in high-tech industries.

Tokayev presses for crypto reserve and ecosystem

In an address to the nation, Kazakhstan’s leader put a particular emphasis on the need to accelerate the formation of “a full-fledged digital assets ecosystem” and the establishment of a national crypto reserve.

Quoted by his press service on Monday, Tokayev insisted:

“A State Fund of Digital Assets should be created, which will accumulate a strategic crypto reserve from the most promising assets of the new digital financial system.”

The fund should be based on the Investment Corporation of the National Bank of Kazakhstan (NBK), the president detailed.

Tokayev believes the introduction of the digital tenge has been helpful, too. The state-issued coin is already used to finance various projects.

The head of state is convinced it’s time to scale up its use in republican and local budgets, as well as those of state-controlled holdings.

But besides the central bank digital currency, the president made it clear he wants to see his country “take into account modern realities” and focus on decentralized crypto assets.

Kazakhstan’s leader calls for liberalizing crypto market

In his speech, Tokayev highlighted the importance of adopting a banking law that takes into account both the needs of the nation’s economy and technological changes, elaborating:

“The law should provide for ways to increase competition and attract new participants to the market, as well as [address] issues of promoting fintech and liberalizing the circulation of digital assets.”

The president insisted that ministers and financial regulators should carefully study the drafted bill and asked lawmakers to adopt the legislation by the end of the year.

Kazakhstan’s president also called on his country’s cabinet and central bank to loosen the purse strings on high-tech and fintech spending, stating:

“The government, together with the National Bank, needs to develop a program for investing in high-tech sectors of the economy in the amount of up to $1 billion dollars.”

Banking assets and capital are more profitable in Kazakhstan than in developed countries, the president remarked, noting that domestic banks tend to invest in low-risk instruments, rather than lend to the economy.

To deal with the issue and trigger a new investment cycle, second-tier banks must be more actively involved in financing the real sector, Kassym-Jomart Tokayev suggested, according to the press release posted by his administration on Telegram.

Astana is serious about changing crypto course

Ever since becoming a mining hotspot in the wake of China’s ban on the activity a few years ago, Kazakhstan has been trying to regulate its crypto space and tap into its profits.

Astana’s initially conservative approach to cryptocurrency regulation has gradually shifted towards a more relaxed regime.

At first, crypto miners could only sell their minted coins on crypto exchanges registered at the capital’s AIFC hub, but in May, financial authorities said they’re planning to legalize crypto trading on other licensed platforms as well.

In early June, the National Bank of Kazakhstan launched a project to issue crypto cards. In September, a local bank announced it’s already testing them with Mastercard, as reported by Cryptopolitan.

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