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Monday, March 27, 2023

Bank of Kyrgyzstan Issues Warning About Cryptocurrencies and Crypto Payments

Bank of Kyrgyzstan Issues Warning About Cryptocurrencies and Crypto Payments – In light of the rising popularity of cryptocurrencies in Kyrgyzstan, the country’s central bank has issued a warning to citizens about the risks of digital assets. Crypto payments are also illegal in the Kyrgyz Republic, according to the monetary authority.

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Cryptocurrencies and other virtual assets are becoming more popular in Kyrgyzstan, according to the country’s central bank. Using them to buy or sell goods and services is still illegal, according to the regulator, with the Kyrgyzstani som remaining the country’s only legal tender.

Also Read: Hackers Are Cloning Web3 Wallets Like Metamask and Coinbase Wallet to Steal Crypto

The monetary authority also issued a warning about the risks associated with decentralized digital currencies, according to local media. “As a rule, no one is liable for cryptocurrency.” “It is not financially supported. It has no actual value because it is not linked to any currency or other asset,” the report stated.

According to the National Bank of Kyrgyzstan (NBK), this increases the risk of exchange rate volatility and loss of value. It also highlighted the risks of cryptocurrency settlements, citing its characteristics and the lack of a “controlling central body.”

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 The NBK went on to say:

“As a result, we advise citizens to exercise caution and avoid utilizing cryptocurrencies for payments and settlements. When making settlements using cryptocurrencies and virtual assets, users assume all possible risks and unfavorable consequences.”

The statement comes after Kazakhstan’s central bank declared last week that it is looking into the crypto market, but that it is too early to talk about legalizing cryptocurrencies like bitcoin.

Also Read: OpenSea Announces Migration to Seaport Protocol

Last year, crypto firms, particularly miners, moved to Central Asia, where the two countries are situated, when China began cracking down on the industry in May 2021. Since then, both countries have attempted to curb mining by shutting down illegal crypto farms and hiking electricity bills for legitimate mining operations. Power outages and damage to electricity networks have been blamed on miners.

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