The government of Uzbekistan has reportedly barred its citizens from purchasing cryptocurrencies.

According to local news outlet Novosti Uzbekistana on Dec. 25, the National Project Management Agency has banned citizens from purchasing crypto, even on established exchanges.

The decision comes as a surprise to many, as the country has previously displayed a relatively lenient stance toward digital currencies.

In September 2018, the country’s government signed a memorandum of understanding to regulate and establish licensing for crypto exchanges, mining operations and initial coin offerings.

That same month, Uzbek President Shavkat Mirziyoyev ordered the establishment of a state blockchain development fund called the "Digital Trust." In July last year, he also signed a decree on the development and integration of blockchain technology into the country’s public administration.

Some exclusions for current crypto holders

While the new regulation bars citizens from acquiring or selling cryptocurrencies, it gives some limited trading permissions to current cryptocurrency holders.

Holders that are citizens of Uzbekistan can sell their current investments on two licensed exchanges after undergoing Know Your Customer procedures, ostensibly to avoid the possibility of money laundering.

Any crypto assets whose origin cannot be proved are illegal to transfer or own in the country. A report from Finance Magnates notes that the law could prove ineffective, given that Uzbeks could use a virtual private network — or VPN — to bypass the ban and access foreign cryptocurrency trading platforms.

Countries around the world have taken a hard line on various aspects of the crypto-industry. Some officials in India have sought an outright ban on all digital assets.

Russian financial regulators are allegedly preparing a ban on the use of cryptocurrencies for goods and services. While some in the industry are reportedly preparing for the impending crackdown, others say that the difficulty of enforcing such a ban means it will be limited to a series of “demonstration cases” that intend to dissuade the public from breaking the law.