The Qatar Central Bank is not taking ample action to implement its own regulations against crypto companies. In a report published on May 31, the global money laundering and terrorist financing watchdog stated that Qatar needs to effectively tackle criminal activities, which also includes sanctioning virtual asset provider services.
However, cryptocurrency is completely banned in Qatar’s Financial Center (QFC) due to the weak compliance with the KYC and anti-money laundering (AML) policy. The ban is designed in such a way that it prevents the use of crypto for financing terrorism. Similarly, there are no tax laws for cryptocurrency, as its use is prohibited.
Restriction on Crypto since 2019
QFC has announced the restriction of crypto usage since December 2019. During that time, the regulatory authority had also stated that they would charge penalties if any firms provided crypto-related facilities. The penalties fall under the QFC’s rights and responsibility.
As per FATF, Qatar had managed to gather sufficient information regarding the ownership for its almost finished unified register, but the unification of data on its citizens has to be done more effectively. However, there is still some uncertainty regarding the information being accurate and up-to-date.
The authorities are requested to improve investigating efforts towards money laundering and enhance analytical capabilities to recognize such instances.
Qatar Interested in CBDC
Qatar has shown interest in the Central Bank Digital Currency (CBDC), and is exploring the potential use cases of implementing it. In June 2022, it was reported that QCB was at the basic stage of issuing it.
Sheikh Bandar Bin Mohammad Bin Saoud Al Thani stated at that time that QCB was looking at the pros and cons of CBDCs, and how also, the work is in the process of using the right technology and platform.
CBDCs are digital alternatives to cash. It makes it easier for people to access financial services and participate in the digital economy. Qatar, on the other hand, plans to study it and also learn the different aspects of digital currency.
A study by the International Monetary Fund (IMF) showed that 76% of central Arab banks are interested in adopting digital currencies, and at least two of them will be able to deliver digital currencies in the next three years.
Presently, banks are not allowed to trade in cryptocurrency due to financial crimes and hacking concerns, which is why transactions related to crypto are completely banned.
Qatar, is in line to join the nations experimenting with Central Bank Digital Currency, although there was a ban on cryptocurrency, which was enforced in 2019 to avoid the highly volatile nature leading to instability in the market. The foremost reason for implementing this ban was to avoid financial crimes and electronic hacking.
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.
Source: https://www.thecoinrepublic.com/2023/06/03/crypto-companies-may-face-strict-action-from-qatar-central-bank/