The National Bank of Georgia announced its plans to regulate the local digital asset market, according to the bank’s governor.
With several countries having proposed regulatory frameworks to regulate cryptocurrencies, the highly unrestrained digital asset market in Georgia will be taking its first steps towards legislation.
Based on an interview with a local news agency, the Governor of the National Bank of Georgia Koba Gvenetadze spoke on the current situation with Russia as it is one of the country’s main trading partners.
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With the sanctions also affecting neighboring countries like Georgia, Gvenetadze was asked whether the country will be implementing set regulations for cryptocurrencies. He claimed that the National Bank of Georgia has already restricted financial institutions from offering crypto services, and urged banks to flag digital asset investors as "high-risk clients."
In regards to further legislation on cryptocurrencies, Gvenetadze stated that the central bank has already prepared a draft version of the crypto legislation as per the requirements of the Financial Action Task Force (FATF). He added:
"We are also benefiting from technical assistance of the International Monetary Fund staff in the development of this regulatory framework. Draft of Legislative changes at this stage includes registration / licensing, compliance testing and AML control requirements for crypto market players."
When asked about the current volumes of crypto transactions in Georgia, the governor could only provide an estimate from MONEYVAL’s report for 2020, which reads that there was a turnover of €1M to €1.5M (~$1.1M-$1.63M) in crypto transactions per month.