https://www.analyticsinsight.net/news/kazakhstan-seizes-167m-and-shuts-130-illegal-crypto-platforms

Kazakhstan’s Financial Monitoring Agency (AFM) has shut down 130 unlicensed crypto exchanges and seized $16.7 million in assets. The enforcement campaign targeted illegal platforms laundering criminal proceeds, as confirmed by Deputy Chairman Kairat Bizhanov during a government briefing.

According to reports, domestic legislation restricts crypto trading to websites registered by the Astana Financial Services Authority (AFSA). These exchanges should also be integrated with traditional banks to capture relevant regulations.

Crackdown on Illegal Crypto Operations

Investigations revealed 81 hidden networks that convert crypto into cash, with transactions exceeding $43 million. Bizhanov stated that these operations violated national anti-money laundering laws and exploited system loopholes.

“The activities of 130 unlicensed crypto exchanges involved in laundering criminal proceeds have been terminated this year,” Bizhanov stated. “Virtual assets worth $16.7 million were seized.”

The AFM has intensified efforts to combat illegal cash-out schemes. Officials uncovered shadow groups handling 24 billion KZT, equivalent to over $43 million. Despite restrictions, cash withdrawals continue to grow at a rapid pace.

Bizhanov noted that total withdrawals reached 13.2 trillion KZT ($24.1 billion), up one trillion from last year. The primary risk lies in anonymous transactions using bank cards issued to nominal account holders.

New Regulations for Financial Transparency

To prevent misuse, the AFM and the National Bank of Kazakhstan introduced tighter cash regulations. Card top-ups above 500,000 KZT ($913) now require an individual identification number (IIN) and confirmation through mobile apps.

Since January 1, banks have also been required to store ATM camera footage for a minimum of 180 days. Authorities aim to expand biometric identification, including facial and fingerprint verification, for all cash transactions.

Cybercrime consultant David Sehyeon Baek told Decrypt that Kazakhstan’s initiative represents “one of the boldest experiments in tying physical identity to financial transparency.”

He said such measures can deter impersonation and improve compliance tracking, but warned of potential misuse. Baek added that governments must weigh anti-crime goals against privacy risks and prevent permanent biometric databases from being abused. Can the growing link between digital identity and financial control strike a balance between innovation and citizens’ right to privacy?

Tightening Business and Blockchain Oversight

The AFM, in cooperation with the Ministries of Justice and Artificial Intelligence, has proposed amendments to strengthen business registration checks. New rules focus on verifying company founders and executives using risk-based criteria.

Authorities have discovered a rise in the use of shell companies for fraud and money laundering. Over the past three years, 3,600 fictitious firms were deregistered after being linked to 30,000 illegal transactions worth 280 billion KZT ($511 million).

The blockchain interests of Kazakhstan are high. According to The Times of Central Asia, the country aims to be a leader in digital asset regulation and blockchain innovation in the region. The twofold strategy of the government, promoting innovation and reinforcing a strict monitoring process, is a wider global trend in the direction of regulated crypto ecosystems, which can be observed in the U.S. and the EU. The structure in Kazakhstan has the potential to affect other countries in the region if it prioritizes transparency and accountability.

Conclusion

Kazakhstan’s Financial Monitoring Agency has intensified its campaign against illegal crypto activity, closing 130 unlicensed exchanges and seizing $16.7 million in assets. The enforcement reflects the nation’s effort to balance innovation with financial integrity through tighter rules and biometric verification.