Trying to stimulate the economy of the country, the Uzbek authorities have taken initiatives to promote the growth and development of cryptocurrency industry. The government of the Republic confirmed that legalizes cryptocurrency exchanges and will allow companies to block access in the country offices. The decision to legalize crypto-exchanges taken in line with the ongoing policy of Uzbekistan – recently, the new President signed a decree on the promotion of the use of cryptocurrency and blockchain technology population.
The document, published on behalf of the President of the Republic of Uzbekistan entitled “on measures On organization of activities of cryptocurrency exchanges in Uzbekistan”, contains a set of formal definitions of bitcoin and other cryptocurrencies.
The government confirmed that it would not consider cryptocurrencies as securities, so the laws pertaining to stock exchanges, will not apply to cryptocurrency exchanges. Instead, the cryptocurrency business will work in accordance with the new set of rules, the so-called special regulations.
Only foreign legal entities, which already have subsidiaries or other enterprises in Uzbekistan, will be able to open a cryptocurrency exchange. These structures will be exempt from paying taxes on their cryptocurrency projects.
On the other hand, any profit made from the cryptocurrency, will not be taxed, given that Uzbekistan gives scriptactive the definition of “records of the dataset on the blockchain” – which they really are is “of value and having the owner”, according to the text.
However, the full freedom of activities of cripture in Uzbekistan can not speak, because the government has also laid down specific conditions for registration and operation of cryptocurrency exchanges.
First, the foreign entity must have an authorized capital sufficient to pay 30 000 minimum wages from the date of application. Moreover, the equivalent of 20,000 times the minimum wage must be kept as reserves in a commercial Bank supported by the state.
Second, the state requires from cryptocurrency exchanges to place their servers in the Uzbekistan.
Thirdly, the Uzbek authorities expect that the exchange will comply with the rules in relation to trading and data publication rates of exchange, based on the ratio of supply and demand.
Finally, the exchange will be required to store information about transactions, user data and other data that meet the laws on verification of identity of clients and anti-money laundering, for five years.
The presidential decree also legalized mining in Uzbekistan and ordered the state energy company to provide the miners of land for their operations. The mining company will use more than 100 kilowatt-hours of electricity in areas designated for their National project management Agency – the Agency created by presidential decree.
Recall that Uzbekistan remains one of the poorest former Soviet republics. Almost a third of the population is working in Russia. The average monthly salary is about 6000 thousand rubles, and such work still have to search. The level of corruption of local officials and security forces, that is, rolls. Democratic institutions are practically a fiction, as all spheres of life, including business, control the local elites (the President and his clan). How effective in such conditions can work cryptocurrency exchanges and mining, time will tell.