The central bank of
Kyrgyzstan has disabled cross-border transactions on the SWIFT financial
network amid widespread unrest over the country’s disputed
parliamentary elections.

Aida Karabaeva, an official
representative of the National Bank of the Kyrgyz Republic, announced a
temporary suspension of SWIFT in Kyrgyzstan in a statement on Oct. 7.

According
to Karabaeva, the bank decided to suspend SWIFT transactions in order
to prevent capital outflows from the country and ensure the safety of
assets. The executive claimed that the bank is planning to resume SWIFT
transactions as soon as the situation in the country stabilizes:

“The
measures taken are necessary to ensure security of the system and the
safety of assets. The National Bank is monitoring the situation, and as
it stabilizes, the banking system will resume operations in normal
mode.”

Karabaeva’s statement comes in conjunction with
Kyrgyzstan’s central bank recommending local financial institutions to
temporarily suspend their activities due to the complicated political
situation. On Oct. 7, the National Bank of the Kyrgyz Republic issued an official statement requesting commercial banks and lenders in Kyrgyzstan to halt operations:

“In
order to ensure safety of the country’s financial and banking sector
and to preserve assets of financial credit institutions, the National
Bank of the Republic of Kyrgyzstan recommends that commercial banks and
non-banking financial credit institutions suspend their work on October 7
and step up security measures until the political situation in the
country stabilizes.”

These measures come amid violent protests that began
on Oct. 5 in response to Kyrgyzstan’s parliamentary elections that were
perceived by protestors as unfair. Following the massive protests,
local electoral authorities annulled the election results on Oct. 6.

Kyrgyzstan is just another example of the traditional banking system’s imperfections in comparison to the crypto industry. In contrast to the traditional banks, major cryptocurrencies like Bitcoin (BTC) do not have a central party to decide the fate of user funds.