Kazakhstan blocks Coinbase, alleges digital-assets law violations: report

Quick Take

  • Kazakhstan’s government has blocked access to Coinbase, citing a breach of its new Law on Digital Assets, according to local media reports.
  • Interactive Brokers and NYMEX faced similar access restrictions previously but were later unblocked, raising questions about the consistency of regulatory enforcement in the country.

The Kazakh government has blocked access to Coinbase in the country, citing violations of a new digital assets law, according to local media reports.

Kazakhstan's Ministry of Culture and Information explained the move was related to cryptocurrency trading on the exchange that directly conflicts with paragraph 5 of Article 11 of its Law on Digital Assets, media outlet Kursiv News reported today.

“The Information Committee of the Ministry of Culture and Information received a request from the Ministry of Digital Development, Innovation and Aerospace Industry of the Republic of Kazakhstan with a request to block the Internet resource www.coinbase.com, which violates paragraph 5 of Article 11 of the Law of the Republic of Kazakhstan On Digital Assets in the Republic of Kazakhstan,” the Ministry told Kursiv.

According to the provision, enforced since April, the issuance and circulation of unsecured digital assets and activities of crypto exchanges are prohibited in Kazakhstan, except within the Astana International Financial Center territory — a fintech hub in Kazakhstan’s capital city with fewer initial regulatory hurdles. AIFC sets forth an independent legal framework based on the law of England and Wales and is also drafted to complement the regulations of the Dubai International Financial Centre.

"As part of Coinbase's ambition to be the world’s most trusted and secure crypto platform, we strive to work collaboratively with policymakers and regulators," a Coinbase spokesperson told The Block. "While this particular matter is still being investigated, the fundamentals remain: Coinbase is committed to compliance in all jurisdictions in which it operates. We do not maintain a physical presence in Kazakhstan and had not received any notification from the Kazakh government prior to this announcement."

Binance, Upbit and Bybit licensed to operate in Kazakhstan

Crypto exchanges — including Binance, Upbit and Bybit — are licensed to operate in Kazakhstan, Kursiv reported, via an AIFC work permit issued by the Astana Financial Services Regulatory Committee.

The block on Coinbase falls under Kazakhstan’s Communications Act — requiring providers to restrict access to sites with prohibited content.


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However, the government has shown some flexibility in the past, unblocking Interactive Brokers and NYMEX after similar restrictions against the companies — without an AIFC work permit issued.

The Ministry of Information did not explain the reasons for restoring their access.

Blocking reported since September for Coinbase and Kraken

Today’s confirmation of Coinbase's block from the Kazakh government follows earlier reports from a local Telegram community, Finance.kz, suggesting that most websites of foreign brokers and crypto exchanges from Kazakhstan do not open without using a VPN — including Coinbase, Kraken and other large exchanges.

Coinbase also faces ongoing regulatory challenges in the U.S. after the Securities and Exchange Commission filed a lawsuit against the crypto exchange in June, alleging securities law violations. Last month, Coinbase said the judge should throw out the case on the grounds that the agency is acting outside its mandate.

Updated with comment from Coinbase.

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

About Author

James Hunt is a reporter at The Block, based in the UK. As the writer behind The Daily newsletter, James also keeps you up to speed on the latest crypto news every weekday. Prior to joining The Block in 2022, James spent four years as a freelance writer in the industry, contributing to both publications and crypto project content. James’ coverage spans everything from Bitcoin and Ethereum to Layer 2 scaling solutions, avant-garde DeFi protocols, evolving DAO governance structures, trending NFTs and memecoins, regulatory landscapes, crypto company deals and the immersive metaverse. You can get in touch with James on Twitter or Telegram via @humanjets or email him at [email protected].