Kazakhstan’s National Bank considers investing its national fund in digital assets

The idea was inspired by international sovereign wealth fund practices.

Key Takeaways

• Kazakhstan's National Bank is considering adding crypto assets to its sovereign wealth and foreign exchange reserves.
• The country plans to establish a state reserve for seized crypto assets and restrict trading to licensed exchanges within the AIFC.

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Kazakhstan’s National Bank is weighing allocating a portion of its sovereign wealth and foreign exchange reserves to digital assets, said the bank’s governor, Timur Suleimenov, during a recent press conference.

According to Suleimenov, in addition to the main reserve management strategies, the bank has special, more aggressive sub-portfolios where it experiments with higher-yield investments, and that’s where crypto could fit in.

“We’ve looked at the experience of the Norwegian fund, the American approach, and the strategies used by Middle Eastern funds. They all have some exposure to crypto assets—either directly, or through ETFs and shares of companies closely tied to crypto,” said the National Bank Head.

Still, the bank is taking a cautious approach to potential investments.

“This is a difficult question, so there is no need to rush here. Yes, such assets can bring high returns, but at the same time, they are highly volatile,” Suleimenov added.

Kazakhstan also plans to establish a state reserve for crypto assets seized by law enforcement agencies, with dedicated infrastructure to be developed. The reserve could include digital assets from state-authorized mining operations through tax collections and mandatory payments.

The country is simultaneously moving to restrict crypto trading to licensed exchanges within the Astana International Financial Centre (AIFC) and plans to implement administrative and criminal penalties for transactions in the unauthorized market. The National Bank also intends to impose limitations on digital asset advertising.

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