The National Agency for Prospective Projects (NAPP), an agency that regulates cryptocurrency markets in Uzbekistan, has announced new directives that require licensed crypto businesses to pay a monthly fee that will go primarily to the country’s budget.

An official document released Wednesday but seen Friday shows the new rule is on file with the Justice Department and takes effect immediately.

The law established by the NAPP, the Ministry of Finance and the State Tax Committee of the Republic of Uzbekistan is already in force.

The fees to be paid vary according to the type of services provided by these companies. For example, cryptocurrency exchanges are expected to pay out 120 million soums ($11,000) per month. The document also highlighted the proportionally smaller payments required from escrow services, mining pools, crypto shops, as well as individual miners.

According to the new rules, 20% of the monthly fees paid by cryptocurrency users and companies will go to the NAPP treasury, while the rest (80%) will go to the country’s budget.

Companies that do not pay the new fee will face penalties that include suspension of their licenses. “Failure to pay the fee within a month is grounds for license suspension. If the company does not pay the monthly fee twice in a year, the license can be cancelled”, indicates the document.

Improve supervision in the market

Last month, Uzbekistan’s crypto regulator blocked access to international exchanges, as part of the government’s efforts to keep alternative payment systems under tight control. Blockchain.News reported on the matter.

On August 12, the NAPP blocked the currencies because they were operating in the country without the licenses they are legally required to obtain.

During that incident, Binance Exchange confirmed that its services were blocked and said that it was in negotiations with the government regarding its status in Uzbekistan.

Efforts to regulate digital currency trading began in 2018 when Uzbekistan legalized cryptocurrency trading. In April, President Shavkat Mirziyoyev issued a decree that tightened the rules governing the industry, pushing the regulation of cryptocurrency trading and mining in the country.

According to regulations, crypto exchanges must obtain a license in Uzbekistan. The NAPP expects that from January 1, 2023, Uzbek citizens and businesses will only transact with licensed crypto exchanges.

According to the regulator, licensed providers must verify user identities and store data about each transaction for five years. Forcing these entities to obtain licenses allows the government to track and tax them.

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