Cryptocurrencies cannot be introduced as a means of payment in Uzbekistan, a senior official at the country’s central bank recently said. In a conversation with local media, the regulator’s representative also noted that the national fiat, unlike cryptocurrencies, is backed by the bank’s assets. The statement comes despite Tashkent’s crypto-friendly steps in the past.
Cryptocurrency cannot be accepted for payments in Uzbekistan, the monetary authority says
Cryptocurrencies like Bitcoin cannot be recognized as legal tender in Uzbekistan and that will likely never change, a central bank official told Spot this week. Speaking to the local news agency, Deputy Chairman of the Central Bank of the Republic of Uzbekistan (CBU) Behzod Hamraev said:
As an economist, I can assume that it will [cryptocurrency] will never correspond to world currencies such as dollars, euros, yen, rubles.
The monetary authority representative pointed out that there are currently 28 trillion Uzbek sums (the nation’s fiat money) in circulation, all of which are backed by the central bank’s assets. “You can even see regulatory obligations written on the banknotes, and nothing backs the cryptocurrency,” he added.
The government of Uzbekistan introduced a ban on the use of cryptocurrency for payments in its legislation back in 2019. Under current law, the sum remains the only legal tender in the Central Asian country. A decree by the National Agency for Project Management, a regulatory authority responsible for overseeing the digital economy, emphasized:
Crypto assets are not allowed to be used as a means of payment on the territory of the Republic of Uzbekistan.
At the same time, the decree also introduced regulations for the licensing and operation of cryptocurrency exchanges. Crypto trading was legalized in 2018, but in December 2019, authorities effectively banned residents from buying cryptocurrencies on the trading platforms while they were allowed to sell their crypto holdings.
Then, in January 2020, Tashkent announced it would create a national mining pool as a priority, establish a licensed cryptocurrency exchange where miners could sell their digital coins, create a blockchain valley, and introduce crypto tax exemptions. The regulated digital asset platform Uznex, operated by the South Korean Kobea Group, was launched later that month.
The latest statement by the Central Bank of Uzbekistan on the status of cryptocurrencies comes after El Salvador became the first country to adopt Bitcoin (BTC) as legal tender alongside the US dollar. A similar statement follows from Dmitry Peskov, spokesman for Russian President Vladimir Putin, who recently said Russia is unwilling to accept the coin as a means of payment.
Do you think Uzbekistan will change its policy towards cryptocurrencies in the future? Do share your expectations in the comments section below.
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