Kazakhstan Plans Crypto Reserve, National Bank to Invest in Digital Assets

Kazakhstan is taking a significant step into the world of cryptocurrency by planning to allocate part of its national reserves into digital asset-related investments. This move follows the example set by sovereign funds in the US, Norway, and the Middle East, which have made modest investments in crypto assets or related companies. The announcement was made by National Bank Chairman Timur Suleimenov, who revealed that Kazakhstan’s alternative portfolios will soon include exposure to crypto assets. These portfolios are designed to pursue more aggressive investment strategies, aiming for higher returns while accepting a greater level of risk.

Suleimenov cited the experiences of the Norwegian fund, the American fund, and Middle Eastern funds, noting that their investments in crypto assets or related companies are relatively small. While the exact scale of Kazakhstan’s investment has not been decided, the country is clearly indicating its intention to join the growing number of sovereign wealth managers who view crypto as a part of a diversified portfolio. However, Suleimenov also acknowledged the volatility of crypto assets, stating that while they can bring high returns, they are also highly volatile. Therefore, there is no rush to make hasty decisions.

In addition to investing in crypto assets, Kazakhstan plans to establish a national crypto reserve. This reserve will store assets confiscated in criminal cases and may eventually receive contributions from state-backed crypto mining operations. The infrastructure to manage and safeguard this reserve is already under development. Suleimenov mentioned that if state-owned enterprises mine crypto on behalf of the government, a portion of those earnings could be funneled into the reserve through taxes or other obligations.

Kazakhstan’s ambitions in the crypto space extend beyond investment. The government has announced plans to introduce a legal framework for a state-run crypto reserve, borrowing international best practices from sovereign funds. This framework will emphasize transparency, sound governance, and long-term sustainability. However, regulatory caution remains a priority. Kazakhstan’s authorities have proposed new administrative and criminal penalties for transactions involving digital assets on the grey market. Currently, crypto trading is permitted only through licensed platforms based in the Astana International Financial Centre (AIFC). The central bank also plans to curb digital asset advertising to reduce retail exposure.

Kazakhstan’s relationship with crypto began in 2021 when Chinese miners relocated following Beijing’s clampdown on the industry. At its peak, the country handled over 27% of global Bitcoin mining activity. Although low energy costs initially made Kazakhstan attractive, the surge overwhelmed the power grid and exposed gaps in regulation. With stricter rules and a clearer policy roadmap, Kazakhstan is now poised to solidify its position in the global crypto economy, both as a mining base and a sovereign investor.