Georgia plans to regulate the cryptocurrency market

In a recent statement made in the newspaper The financial ”, Governor of the Georgian National Bank Koba Gvenetadze, informs that regulation of the cryptocurrency market is coming soon. This decision will reveal the real size of the market with regard to the demand for crypto-assets. in Georgia. Recalling that the central bank, in accordance with the guidelines of international agencies, had drawn up a bill to regulate the cryptocurrency sector. The governor assures that the drafting of this new bill was made with the support of the International Monetary Fund (IMF).

A bill for the cryptocurrency market

Today Georgia faces many risks vis-à-vis digital assets. A country where it is relatively easy to do business, the mining sector is developing rapidly in the territory. Activity in Georgia accounts for nearly 1% of the hashrate relative to mining activity for the Bitcoin cryptocurrency. Difficult to know the current total activity of crypto assets in Georgia since no regulation exists.

A committee of experts in charge of risk assessment on money laundering and terrorist financing had estimated the activity of cryptocurrencies around one million euros per month in 2020.

In order to comply with a Council of Europe request on it, Georgia has for the time being prohibited financial institutions from providing digital asset exchange and transfer services. In addition, organizations operating in this area are part of a high-risk rating. Also, they must be the subject of appropriate reinforced preventive measures in order to prevent risks related to cryptocurrencies.

Georgia Cryptocurrency Market Regulation

Even if the date of this new legislation has not been specified, Mr. Gvenetadze reassures about the quality of this bill. It meets the requirements of the International Financial Action Task Force to regulate the cryptocurrency market. Also, the country has the assistance of the International Monetary Fund (IMF) to develop the legislative framework of this law.

It should be noted that the bill includes at this stage, registration and the issuance of a license to practice in this field. It also provides compliance testing and AML (Anti-Money Laundering) control requirements for players in the cryptocurrency industry.

As stated above, certain measures to protect the players in this ecosystem had already been put in place by the Georgian national bank.

Conclusion

Before Mr. Gvenetadze’s announcement regarding the regulation of the cryptocurrency market on Georgian territory. The country had already launched a bill to teach cryptography to students. He wanted to highlight the contribution of knowledge in this new field of cryptography. This gives students a vision as well as details on an emerging asset class.

It is a sign of interest andunprecedented enthusiasm in this Eastern European country. Georgia, has a population of over 4 million people. It is actively preparing to properly regulate the cryptocurrency industry. Could this country be an example to follow at the international level regarding the regulation of crypto-assets?

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Georgia plans to regulate the cryptocurrency market


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