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Legislation of Kyrgyzstan is blockchain-friendly

Kyrgyzstan’s legislation is friendly to commercial transactions with any assets based on distributed ledger records (crypto-assets). Such is the conclusion of the report "The Legal Status of Blockchain Commerce in the Kyrgyz Republic."

The report, prepared by an international law firm, was commissioned by the Kyrgyz Stock Exchange and the International Finance Centre Development Agency. The purpose of the research was to determine how Kyrgyz law regulates blockchain-based business: cryptocurrency trading, crypto-mining, exchange trading of crypto-assets and «initial coin offerings» (ICOs).

The report concludes that the law of the Kyrgyz Republic does not forbid or hinder the development of good faith projects based the blockchain technology, including crypto-asset mining and trading. The law only provides that this must be done with due regard to the Tax Code, anti-money laundering controls, consumer and investor protection norms and other legislation regulating the ordinary commerce.

The uniqueness of Kyrgyzstan’s legislation is that it already allows to engage in crypto-commerce with a global outreach on the basis of the Kyrgyz jurisdiction.

"Without a need for legislative reforms Kyrgyzstan can now satisfy the demand of global crypto-investors to transact business with blockchain-based assets on a firm legal basis. Having said that, we are fully in agreement with the position of the National Bank that non-professional investment of savings into crypto-assets carries an unacceptable risk. The introduction of blockchain technologies can speed up securities settlements, optimize State procurement procedures and make the country a regional centre for public issues of securities for startups," note the authors of the report.

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