The Ministry of Finance of Kuwait states that it does not recognize bitcoin and that it is prohibited for financial institutions to trade in crypto-currencies.
According to the Arab Times, sources from the ministry explained that the Central Bank of Kuwait does not allow financial institutions, banks and affiliated companies to trade bitcoin, including because of the recent sharp rise in prices.
However, the source added that neither the Ministry of Finance nor the Central Bank can regulate the trade in bitcoins as a whole, since they do not recognize the crypto currency. In addition, trade in bitcoins "got out of control" of the authorities, as it is managed via the Internet, the local newspaper reports.
CThe central bank of Kuwait has previously appealed to the Ministry of Trade and Industry of the country with a request to take measures to inform consumers about the risks of the digital currency.
The Arab Times reported that Kuwaiti citizens were keenly interested in bitcoin trading after the recent explosion of asset prices. Sources from the prosecutor's office indicated that the country's law can not prohibit online commerce, as it falls under the laws of "electronic programs".
The newspaper quoted a local official:
Revenues from operations with bitcoin that are obtained as a result of trading outside Kuwait are considered illegal, because Kuwaiti law does not consider these currencies.
At the same time, elsewhere in the Middle East, the Central Bank of the United Arab Emirates in February this year specified that bitcoin is not banned in the country.