- Kazakhstan plans a state crypto reserve using seized digital assets under central bank oversight framework and custody.
- The reserve combines seized crypto with foreign currency and gold to limit risk and improve transparency controls.
- Authorities route crypto exposure through hedge funds after a crackdown on illegal exchanges and mining activity.
Kazakhstan’s central bank investment arm has announced plans to expand a state-backed crypto reserve. The National Investment Corporation will use seized digital assets to support the fund. The reserve will also rely on foreign currency and gold holdings. Authorities aim to manage crypto exposure through regulated channels. This step reflects a cautious shift in national crypto policy.
The investment arm confirmed it has already set aside $350 million in foreign currency and gold. Officials plan to combine these assets with crypto seized during criminal investigations. The corporation has opened a dedicated account at Kazakhstan’s Central Depository. This account will hold all crypto-related investments. The structure supports transparency and centralized oversight.
Reserve Funding and Custody Framework
The National Investment Corporation does not plan to buy crypto directly. Instead, it will gain exposure through structured investment vehicles. This approach reduces operational and market risks. Moreover, it aligns with conservative investment practices. Officials expect this model to support gradual reserve growth.
The dedicated custody account separates crypto investments from daily central bank operations. This separation limits systemic risk and accounting conflicts. In addition, the structure improves reporting and supervision. Authorities want clear asset tracking at every stage. The framework reflects tighter financial discipline. Earlier last year, Kazakhstan’s central bank announced plans to support a state-run crypto reserve funded by seized assets and government-linked mining.
Hedge Funds and Venture Capital Exposure
The investment arm plans to work with hedge funds that specialize in crypto markets. It has shortlisted five firms for this role. However, officials have not disclosed the fund names. The corporation will rely on these managers for crypto exposure. This strategy avoids direct market trading.
In addition, the corporation plans to invest in crypto-focused venture capital funds. This move broadens exposure beyond liquid tokens. It also supports early-stage blockchain projects. Officials aim to balance risk with long-term returns. The strategy favors controlled participation over speculation.
Crackdown Drives Asset Seizures and Policy Reset
Kazakhstan’s reserve plan follows a wide crackdown on illegal crypto activity. Law enforcement agencies have shut down 130 unlicensed crypto exchanges. The platforms brought in approximately $124 million in total revenue. More than $5 million-worth of assets have been confiscated by investigators. Authorities plan to channel part of these assets into the reserve. Additionally, wallets associated with Aleksey Bilyuchenko transferred 1,300 bitcoins with a value of approximately $114 million to unknown exchanges in December.
Authorities associate the crackdown with wider financial stability issues. The regulators are still targeting capital outflows and underground exchanges. These initiatives are in line with the 2022 mining crisis which caused a shortage of power. That period forced a sharp policy review. Since then, authorities have tightened oversight and controls.
The new reserve reflects this revised approach. Policymakers now emphasize regulation and risk management. The strategy signals a cautious return to crypto engagement. Authorities aim to rebuild trust through structure and enforcement. The focus remains on stability and compliance.
