Koba Gvenetadze, Governor of the Central Bank of Georgia also named National Bank of Georgia (NBG) has announced during an interview with The Financial that there are plans to regulate the use of cryptocurrency in the country.
According to his response to one of the questions asked in the latter part of the interview, a draft has been drawn to accommodate the necessary structures for the market in tandem with the Financial Action Task Force (FATF) provisions.
During the interview, Gvenetadze mentioned that the central bank has been receiving support from the International Monetary Fund (IMF) employees to put together the legislation rules and guidelines. And presently, the volume of crypto traded and held in Georgia is unspecified as there are no regulated data banks that provide such vital information.
Moneyval, a money-laundering watchdog in Europe, had tied the estimated monthly trading value of crypto in Georgia between $1.09 million and $1.64 million. At that time, Moneyval advised the Georgian financial government agencies to heighten security on money laundering and the use of digital assets to bankroll terrorist and their activities.
The NBG is putting all of its previous notifications and information together and is teaming up with the IMF staff and the Financial Action Task Force to enforce its requirements. While the legislative process is still ongoing, no crypto firm is permitted to carry out its operations in the Black Sea country.
Re-alignment of Digital Assets Operations in Georgia
All crypto exchange and transfer activities have been put on hold until the completion of the legalization. Any trader or investor who is found to transact in digital assets will be regarded as ‘high-risk’ and applicable preventive gauges will be administered against such person.
There has been no formal announcement of a precise date for the introduction of these regulatory rules. Information known to be included in the drafted set of rules are details on licensing, anti-money laundering schemes, compliance tests, and the control requirements for digital assets.
With Georgia controlling about 1% of the Bitcoin (BTC) hash rates globally, especially with its population and favorable energy provision from hydropower, the effect of this legislation on the mining of cryptocurrency might be an upswing.