Central Bank Of Georgia Is Working On A Law To Regulate Crypto

Georgia is preparing a legislation to regulate its cryptocurrency market. The Governor of the nation’s central bank, National Bank of Georgia, Koba Gvenetadze said that they have already developed a draft of the regulatory legislation in accordance with the requirements of international agencies.

According to Gvenetadze, due to lack of regulation, the size of the Georgian crypto market is unknown. The Council of Europe money laundering monitoring body, Moneyval, estimated the country’s monthly transaction volume at between 3.5 million and 5 million Georgian lari, or $1.09 million to $1.64 million.

Moneyval has also pushed Georgian authorities to “strengthen the practical application of their measures to combat money laundering and financing of terrorism.”

The up and coming new legislation is in line with international Financial Action Task Force (FATF) requirements, the central banker continued, and was drafted with assistance from the International Monetary Fund (IMF).

As of now, financial institutions in Georgia are not allowed to provide virtual asset exchange and transfer services, and clients engaged in activities with virtual assets are considered high-risk and are “subject to appropriate enhanced preventive measures.”

Gvenetadze did not specify when the regulatory legislation will be introduced to parliament.

Crypto Mining in Georgia

Georgia has long had a crypto mining sector, accounting for almost 1% of the total Bitcoin (BTC) hash rate, which is high for a country with a population just under 4 million. While the country has plenty of hydropower, power shortages in the remote Svaneti region over the winter were attributed to illegal private crypto mining. Free electricity is provided to private residences in the region as part of an attempt to retain the population.