Crypto License in Kazakhstan

The regulatory framework for cryptocurrencies in Kazakhstan is aimed at creating a favorable environment for the development of virtual resources while ensuring the protection of investors and compliance with international standards. Here are some critical aspects of crypto licensing legislation in Kazakhstan.

• Cryptocurrency License Types: The AFSA issues many types of crypto licenses in Kazakhstan, but the most popular are a license for cryptocurrency exchange actions and a license for crypto mining actions. The licenses are issued for a term of up to five years.
• Application Process: To obtain a crypto license in Kazakhstan, the applicant must establish a legal entity within the country and obtain a certificate of incorporation. The applicant must then submit a detailed application to the AFSA, which includes data about the proposed business actions, compliance policies and procedures, risk management strategies, and monetary projections.
  An Authorised Market Institution must hold the following minimum capital: An amount equal to 6 months’ operational expenses; plus, unless the AFSA directs otherwise, an additional amount of up to 6 months of operating expenses. (Starting from $10000)
• AML/CFT Procedures: The applicant is required to adhere to the statutes pertaining to anti-money laundering (AML) and counter-terrorist financing (CFT). This entails the implementation of Know Your Customer (KYC) protocols, performing customer due diligence, and promptly reporting any suspicious transactions to the AFSA.
• Cybersecurity: The applicant is obligated to possess adequate cybersecurity protocols in place to safeguard against hacking, theft, and other cyber-related risks.
• Reporting: The licensee is required to consistently provide reports to the AFSA and undergo annual audits as a means to verify compliance with relevant laws and regulations.
• Penalties and Fines: Non-compliance with cryptocurrency licensing legislation may result in penalties, fines, or license revocation.

The Tax Code governs the tax regime within the AIFC except for certain deletions outlined in Article 6 of the Constitutional Law. These deletions refer to 0% tax benefits available to AIFC participants:

• Corporate income tax or value-added tax
  (CIT or VAT) applies to income earned from the provision of financial services within the AIFC, provided that the service provider holds a license from the AIFC Committee for Financial Services Regulations.
• Corporate income tax (CIT) is levied on income earned from legal, auditing, accounting, and consulting services provided to AIFC bodies and on income earned by AIFC participants providing financial services, as listed in paragraph 3 of Article 6 of the Constitutional Law.

To be exempt from Corporate income tax (CIT), AIFC participants must maintain separate records in accordance with the Regulations on Keeping Separate Accounting of Income Subject to Exemption of Corporate Income Tax and Subject to Taxation, as well as Expenses Subject to Allocation to Deductions by the Participants of AIFC.

• AIFC participants who provide financial and support services are subject to property tax and land tax on objects located within the AIFC, as listed in paragraphs 3 and 4 of Article 6 of the Constitutional Law.
• Foreign individuals employed by an AIFC participant providing financial and support services are not subject to individual income tax on income earned from activities within the AIFC under an employment contract concluded with an AIFC participant. The list of financial and support services AIFC participants provide is specified in paragraphs 3 and 4 of Article 6 of the Constitutional Law.