Kuwait Ministry of Finance refuses to recognise Bitcoin

Published:  26 Dec at 6 PM
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In spite of reports of huge Kuwaiti interest in the cryptocurrency, the emirate’s Ministry of Finance has refused to recognise Bitcoin and has banned its trading.

According to the Arab Times, an unnamed ministry source told reporters the Kuwaiti Central Bank is disallowing banks, financial institutions and affiliated companies from trading in the cryptocurrency. The reason given was the recent surge and fall in Bitcoin values. However, the source added neither the Ministry of Finance nor Kuwait’s Central Bank are able to effectively regulate Bitcoin trading as neither institution recognises the cryptocurrency.

In addition, both the bank and the ministry consider Bitcoin trading will always be out of their control as it’s managed via the internet. As a result, both organisations are preparing to issue consumer information warning about the risks of investing in Bitcoin and other cryptocurrencies. Earlier this month, the Arab Times featured a report on expats’ and Kuwaiti citizens’ strong interest in Bitcoin trading following the dramatic surge in price of the digital currency. Given its equally dramatic fall over the past few days, investors in Kuwait may have learned their lesson the hard way.

Kuwait seems to be standing alone as regards a Bitcoin ban, as other Middle East countries as well as the UAE’s Central Bank are refusing to implement a similar ban, even although the bank had previously issued a statement stipulating any virtual currency transactions of any kind were prohibited. An update to the statement clarified the initial regulations ‘did not cover virtual currency defined as digital units used as stored value, mediums of exchange or unit accounts’.

Would-be Bitcoin investors could well be forgiven for a sense of confusion at that point, and might be joined by Kuwait’s Public Prosecution Office, which said the emirate’s law cannot forbid online virtual currency trading as it falls under ‘e-programme laws’.
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