The Korean Blockchain Business Association (KOBEA) and the Government of Uzbekistan have signed a memorandum of understanding (MoU) to establish the first encrypted exchange authorized by the government.
The National Agency for Project Management (NAPM) under the President of the Republic of Uzbekistan has established a direct partnership with KOBEA to facilitate the growth of the sector of cryptocurrencies and blockchain in the country.
In the years to come, the Government of Uzbekistan will contribute to the creation of a large-scale fund to finance startups and innovative projects in the technology, cryptocurrency and blockchain industries.
Motivation behind the decision
In 2012, Uzbekistan was officially listed as a Specially Designated Global Terrorist under Executive Order 13224, which allowed individuals and companies in the United States to engage in financial transactions with c companies and financial institutions in Uzbekistan.
In the course of 2018, countries like Iran and Turkey saw a rapid increase in the demand for cryptocurrencies due to the tightening of sanctions imposed by the US government and the devaluation of their national currencies.
However, given the absence of sanctions from both the US government and the EU in the region, it is clear that Uzbekistan's decision to open its economy for cryptocurrencies and blockchains is not has no relationship with its relations with the United States and the current financial status of the country.
Rather, as observed by NAP government officials Uzbekistan M, the government has reached consensus to develop and create a friendly ecosystem for crypto startups after assessing the success of Malta and Zug of Switzerland in attracting blockchain-related businesses with practical regulatory frameworks.
Malta, a country within the EU characterized as "the blockchain island", recently saw three multi-billion dollar companies move to their Malta headquarters thanks to its cryptocurrency policies favorable.
Revolut and Binance have permanently established a new office in Malta, bringing hundreds of employees and hundreds of millions of dollars of monthly profits into the region. Tron, an important blockchain project, is expected to migrate to Malta in the coming months.
To compete against Malta, Busan of South Korea, Jeju Island, Switzerland and other major crypto markets, the Government of Uzbekistan said it would set up large-scale research and development centers, mining town of Chorvoq and efficient banking relationships for cryptocurrency exchanges.
Are the favorable policies for crypts sufficient?
The Philippines, South Korea, Malta, Switzerland, Singapore, Thailand and many countries in Europe have already introduced cryptocurrency policies to meet blockchain startups.
The simple imposition of practical regulatory frameworks will not be enough to convince companies based in regions with real crypto communities.
But, the optimistic attitude of the government towards various sectors of the cryptocurrency market, including the first offers of coins (ICO), mining, trade and development bring large-scale startups into the consider the possibility of setting up offices in Uzbekistan as a secondary option.
As seen in the case of Malta, the process of the crypto industry of Uzbekistan has evolved to reach the size of its competitors in Asia and Europe could take many months or years. Depending on the commitment and commitment of the government, the recent project implemented by the NAPM could allow the country to be recognized as an emerging technology hub in Central Asia.
Images from Shutterstock
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