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Ordonnance n°2022-005 sur les établissements de crédit: (Ordinance No. 2022-005 on Credit Institutions) – This governs banking and credit institutions. If a token's issuance or associated activities resemble banking or credit operations, this ordinance would be relevant.
Other Possibility: Unregulated Digital Asset / Foreign Currency Instrument: If a stablecoin is pegged to a foreign currency (e.g., USD) and is not formally integrated into the local payment system or issued by a locally licensed entity, it might exist in a regulatory grey area or be treated more akin to a foreign currency instrument or an unregulated digital asset, subject to general foreign exchange regulations if traded or used locally.
If classified as E-money: E-money regulations typically require issuers to hold 1:1 backing for all e-money issued. These funds must usually be held in segregated accounts at the central bank or a licensed commercial bank, protected from insolvency claims of the issuer. This ensures that users can always redeem their e-money at par with fiat currency.
If classified as E-money: Issuers of stablecoins operating as e-money providers would be required to obtain a license from the Banque Centrale de Madagascar (BCM). This licensing process typically involves stringent requirements concerning capital, governance, risk management, consumer protection, and AML/CFT compliance.
No Active CBDC Project: The Banque Centrale de Madagascar has not publicly announced any active project or concrete plans for issuing a Central Bank Digital Currency (CBDC).
Approach: Unregulated, with official warnings/disapproval. Madagascar has not implemented a dedicated regulatory framework for virtual assets. Instead, the Central Bank has issued strong advisories highlighting the risks associated with cryptocurrencies. This leans towards a "partial ban" in practice due to the severe warnings and lack of legal recognition, rather than a comprehensive legislative ban. The government appears to be monitoring the situation rather than actively promoting or regulating the space for now.
Exchanges: There is no licensing or regulatory framework for cryptocurrency exchanges to operate in Madagascar. As such, any entity operating a crypto exchange would be doing so outside the regulated financial system. The BCM's warning extends to the use of such platforms, emphasizing the lack of oversight and consumer protection.
Overall Status: Madagascar has made progress in some areas of its AML/CFT framework as required by the FATF Action Plan. However, the comprehensive regulation and supervision of Virtual Assets (VAs) and Virtual Asset Service Providers (VASPs), including the implementation of the Travel Rule, is not yet effectively in place. Madagascar's Mutual Evaluation Report was published in 2018, prior to the significant updates to FATF Recommendation 15 and the issuance of the Interpretive Note on VAs/VASPs in June 2019, which introduced the Travel Rule. Subsequent Follow-Up Reports indicate that addressing risks associated with new technologies and developing a regulatory framework for virtual assets remains an area requiring significant work.
Whether Adopted: The FATF Travel Rule requirements (which necessitate VASPs to obtain, hold, and transmit required originator and beneficiary information for virtual asset transfers) have not been formally adopted or effectively implemented within Madagascar's legal and regulatory framework for virtual assets. Madagascar's AML/CFT framework likely lacks the specific legislation or regulations necessary to govern VASPs and mandate Travel Rule compliance.
Effective Date: Given the lack of formal adoption, there is no specific effective date for the FATF Travel Rule in Madagascar.
Technical Implementation Requirements: Since the Travel Rule is not implemented, there are no defined technical implementation requirements for VASPs in Madagascar.
Anti-Money Laundering and Counter-Terrorism Financing Act 2018 (AML/CTF Act 2018): This Act forms the cornerstone of the RMI's regulatory regime. It mandates financial institutions, including VASPs, to implement robust AML/CTF programs, which explicitly cover sanctions compliance.
Financial Intelligence Unit Act 2006 (as amended): Establishes the RMI Financial Intelligence Unit (FIU), which is the primary body responsible for receiving, analyzing, and disseminating financial intelligence related to money laundering, terrorism financing, and other serious offenses, including sanctions violations.
Digital Asset Secured Transaction Act 2023 (DASTA 2023): While primarily focused on property rights and the legal framework for digital assets as collateral, DASTA acknowledges and interacts with the broader regulatory environment for digital assets, implying that entities dealing with digital assets must comply with existing AML/CTF and sanctions laws.
OFAC Sanctions Compliance:
Develop and implement a risk-based sanctions screening program. This involves screening all customers (at onboarding and ongoing), beneficial owners, and transactions against relevant sanctions lists.
Individuals, entities, or governments designated on the above-mentioned sanctions lists, regardless of their location.
Persons or entities located in, or closely associated with, comprehensively sanctioned jurisdictions. While the RMI does not issue its own list of prohibited countries, compliance with UN, OFAC, and EU sanctions means that transactions with countries like North Korea, Iran, Cuba, Syria, and regions or entities subject to targeted sanctions (e.g., certain entities in Russia, Venezuela) are either prohibited or extremely high-risk and require enhanced due diligence.
Criminal Penalties: Individuals found guilty of offenses under the Act, including aiding or abetting money laundering or terrorism financing (which includes violations of sanctions aimed at preventing these crimes), can face:
Reference: Specific penalty provisions would be found in the "Offences" and "Penalties" sections of the AML/CTF Act 2018.
Regulatory Approach: Unique/Specific, leaning towards partial. The Marshall Islands enacted specific legislation in 2018 to create a national digital currency (the "Sovereign" or "SOV") and declared it legal tender. However, beyond this specific initiative, a comprehensive regulatory framework for general virtual assets, Virtual Asset Service Providers (VASPs) like exchanges, or detailed Anti-Money Laundering/Counter-Terrorist Financing (AML/CFT) rules specifically for private crypto activities (separate from traditional financial services) does not appear to be robustly in place or actively enforced. The SOV project itself has faced significant delays and international opposition.
Adopted: Yes, the Marshall Islands has enacted specific legislation to regulate Virtual Asset Service Providers (VASPs) and incorporate FATF AML/CFT standards, including the Travel Rule.
The Virtual Asset Service Providers Act 2022, particularly Section 20 ("Transfer of virtual assets"), states that a VASP must "collect and retain the required originator and beneficiary information... in accordance with the FATF Recommendations and any applicable regulations issued by the Authority."
While the Act itself defers to "applicable regulations," it strongly implies these FATF standard thresholds would be adopted. However, specific RMI-issued regulations explicitly setting these thresholds for virtual assets may still be in development or integrated into broader AML/CFT guidance.
The Virtual Asset Service Providers Act 2022 (Section 2 - Interpretation) defines "virtual asset service provider" broadly, aligning with FATF definitions, to include any natural or legal person who, as a business, conducts one or more of the following activities or operations for or on behalf of another natural or legal person:
The Act does not prescribe specific technical protocols (e.g., TRISA, Sygna, etc.) for the transmission of this information. Instead, it defers to "regulations and guidance issued by the Authority." This allows the MFSA flexibility to adopt industry best practices or specific technologies as they evolve. As of late 2023/early 2024, specific technical guidance from the MFSA detailing these protocols has not been widely publicized.
For NBNM Payment Institution License: If a company also requires a payment institution license from the National Bank of North Macedonia due to handling fiat payments, then specific minimum capital requirements will apply, similar to those for traditional payment service providers (e.g., initial capital of EUR 20,000 to EUR 125,000 depending on the type of payment services offered, plus ongoing capital requirements).
Focus on Warnings: The SECRNM, alongside the National Bank of the Republic of North Macedonia (NBRSM), has primarily issued general warnings to the public about the risks associated with investing in crypto-assets, highlighting their speculative nature, lack of regulation, and potential for fraud. The NBRSM has also focused on Anti-Money Laundering (AML) concerns related to crypto.
Limited Market Activity: The scale of security token offerings specifically targeted at North Macedonian investors might be limited, leading to fewer direct enforcement cases.
National Bank of the Republic of North Macedonia (NBRSM):
No Specific Licensing: There is no specific licensing regime for stablecoin issuers in North Macedonia.
However, operating as a stablecoin issuer per se, without fitting into existing regulated categories, does not require a specific license, but it also means operating outside the regulatory framework and consumer protection.
Redemption rights would be solely dependent on the terms and conditions set by the stablecoin issuer, which users would agree to when acquiring the stablecoin. The enforceability of these contractual rights would fall under general contract law, but without a specific regulatory framework, consumer protection is limited.
Exploration Stage: The National Bank of the Republic of North Macedonia has expressed interest in monitoring global developments regarding Central Bank Digital Currencies (CBDCs) but has not announced concrete plans for issuing its own CBDC. Their focus has been on modernizing payment systems and increasing financial inclusion.
No Direct Interaction: Currently, there is no direct regulatory or operational interaction between stablecoins and a potential CBDC in North Macedonia, as the CBDC project is still in a very early conceptual or exploratory stage, if at all. Should a CBDC be introduced, it would be a distinct, central bank-issued digital currency, likely designed to complement or coexist with cash, not directly interact with private stablecoins in a regulatory sense, although it might impact their market dynamics.
Cautionary Stance: The National Bank of North Macedonia has issued warnings to the public regarding the risks associated with virtual assets.
Regulatory Status of Exchanges: Currently, there is no dedicated licensing regime for cryptocurrency exchanges or other virtual asset service providers (VASPs) operating within North Macedonia.
Future Impact of Draft Law: The proposed Law on Virtual Assets is expected to introduce a licensing framework for exchanges and other VASPs, bringing them under direct regulatory supervision and enhancing consumer protection and AML/CTF compliance. Until then, the environment remains largely unregulated specifically for crypto operations.
Administrative Fines: Substantial monetary fines can be imposed on the VASP (legal entity) and/or responsible individuals within the VASP's management. These fines can vary depending on the severity and recurrence of the breach.
Lack of Specific VASP Licensing: Currently, there is no explicit licensing regime for VASPs in Mali. This means that while they might be implicitly covered by general AML/CFT laws, the specifics of their operation, authorization, and prudential regulation remain largely undefined.
Entity Targeted: All regulated financial institutions (banks, microfinance institutions, payment service providers, etc.) within the UEMOA zone, including those operating in Mali. Also serves as a warning to the general public.
Outcome: A de facto ban on formal cryptocurrency operations within Mali's regulated financial sector. Financial institutions are prohibited from offering crypto services, and the public is warned about the risks and lack of regulatory protection.
Penalty Amount: Varies depending on the scale of the fraud; can include prison sentences and financial reparations to victims. Specific public records of these amounts for crypto-specific cases in Mali are difficult to pinpoint from international sources.
None specifically for crypto. Since there is no dedicated crypto regulatory framework, there are no specific licenses for these activities.
Neither a registration nor a specific licensing regime currently exists for VASPs in Mali.
Entities operating in this space are doing so outside of a recognized regulatory framework. This is not a "light touch" approach; rather, it indicates a lack of formal permission or supervision, which can be interpreted as implicitly disallowed for formal financial sector participation.
Dedicated AML/KYC requirements specifically for VASPs under a crypto licensing regime. However, Mali, as a member of GIABA (Groupe Intergouvernemental d'Action contre le Blanchiment d'Argent en Afrique de l'Ouest), is subject to general Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) laws that apply to the traditional financial sector. Any entity handling funds (even if virtual) would be well-advised to adhere to international best practices for AML/KYC to mitigate risks, as these general laws could potentially be applied by analogy or if the entity interacts with the traditional financial system.
Local presence mandates under a specific crypto licensing regime. If an entity were to operate legally within the traditional financial sector, it would certainly require local incorporation and presence.
Banking Difficulties: Entities dealing with virtual assets often face severe challenges in accessing traditional banking services, as banks are bound by BCEAO directives and their own risk assessments.
Obligations: Similar to UN sanctions, any hits should lead to asset freezing and reporting to CENTIF.
They operate in a manner that "causes" a U.S. person to violate sanctions.
Sanctions Screening: Screen customer names, addresses, and other identifiers against the UN, EU, and OFAC sanctions lists at onboarding and on an ongoing basis. For crypto, this can extend to screening associated wallet addresses using blockchain analytics tools against lists of addresses known to be associated with sanctioned entities.
Countries under UN/EU Embargoes: Depending on the specific sanctions regime, certain transactions with or involving individuals/entities from embargoed countries may be prohibited.
Financial Penalties: Significant fines for institutions and individuals.
Legislation Name: BCEAO Communiqué regarding the regulatory framework for virtual assets / digital assets. While there might not be a single "law" per se, the BCEAO's official pronouncements serve as the regulatory framework for its member states.
Date: Issued in June 2021 (often referenced as Communiqué No. 1362/SP/BCEAO/2021, though sometimes the specific circular number is given as Circular No. 2021/CIR/0002/SP/BCEAO on virtual assets).
Financial institutions under its purview (banks, microfinance institutions, payment service providers) are prohibited from engaging in activities related to virtual assets, including holding, exchanging, or providing services involving them.
None Identified: As of the latest information, Mali has not enacted any specific tax legislation tailored to cryptocurrencies or virtual assets. The taxation would rely on the interpretation and application of the existing Code Général des Impôts.
Post-Coup Environment: Since the February 2021 military coup, Myanmar's financial and legal landscape has become highly opaque. The military junta (State Administration Council - SAC) maintains the ban.
Central Bank of Myanmar's Stance (Ongoing since May 2020, reinforced post-coup):
UK Sanctions List: https://www.gov.uk/government/publications/the-uk-sanctions-list (Includes Myanmar designations)
Civil Penalties: Substantial monetary fines (e.g., OFAC civil penalties can reach millions of dollars per violation).
Criminal Penalties: For willful violations, individuals and corporate officers can face significant prison sentences and even larger fines.
OFAC Enforcement Information: https://ofac.treasury.gov/recent-actions/20230222-3375 (Example of a recent enforcement action against a VASP for sanctions violations, though not Myanmar-specific, illustrates the general approach)
OFAC's Specially Designated Nationals and Blocked Persons (SDN) List: Contains numerous individuals and entities linked to the Myanmar military regime.
UK Sanctions List: Also includes Myanmar designations.
General Securities Exchange Law: Myanmar has a Securities Exchange Law (2014) which defines what constitutes a "security." However, this law predates the widespread emergence of cryptocurrencies and has not been updated or interpreted by the Securities Exchange Commission of Myanmar (SECM) to specifically address digital assets. The general definition of a "security" in the law might broadly encompass certain characteristics of investment contracts, but without specific guidance, it does not apply to crypto due to the CBM's blanket ban.
National Unity Government (NUG) stance (unofficial): It's crucial to note the parallel developments. The National Unity Government (NUG), formed by elected lawmakers ousted by the 2021 military coup, has taken a different stance. In December 2021, the NUG declared Tether (USDT) as an official currency for local use. This move, however, is not recognized by the SAC and has been met with further warnings from the CBM, reinforcing its ban on all cryptocurrencies. The NUG's action does not classify USDT as a security but rather as a currency.
Prohibited: Similarly, there are no specific rules for secondary trading of cryptocurrency tokens because all such activities are generally prohibited by the Central Bank of Myanmar. Any platforms or individuals engaging in secondary trading would be operating outside the legal framework and subject to enforcement actions.
Central Bank of Myanmar Warnings (2020/2021 onwards):
Potential for Legal Action: Individuals or entities found to be dealing in cryptocurrencies could face charges under existing financial laws relating to unauthorized financial services, foreign exchange regulations, or potentially even broader laws depending on the specific activities involved (e.g., money laundering if large sums are involved). While specific public enforcement cases leading to conviction often receive less international media attention from Myanmar, the regulatory pronouncements themselves serve as a significant deterrent and official stance.
Central Bank of Myanmar (CBM) Notification No. 1/2020 (29 January 2020):
Outright Ban: Myanmar's regulatory approach to cryptocurrencies and virtual assets is an outright ban. This means that activities related to crypto, including holding, trading, mining, or using them as a medium of exchange, are prohibited. This stance is largely driven by concerns over financial stability, consumer protection, potential for illegal activities (money laundering, terrorist financing), and capital controls in the context of the country's political and economic instability following the 2021 military coup.
High Risk for Individuals: Individuals who engage in crypto trading or holding risk facing severe penalties, including fines and imprisonment, under existing financial and other relevant laws (e.g., foreign exchange management law). There is also a significant risk of scams, fraud, and loss of funds, with no legal recourse or consumer protection.
Continued Use in Grey Market: Despite the ban, there is anecdotal evidence and reports of limited, informal, and illicit use of cryptocurrencies, particularly stablecoins, within Myanmar's grey market, often for cross-border transactions or capital preservation amidst economic uncertainty and banking restrictions. However, this occurs entirely outside the legal framework and carries substantial risks.
Whether Adopted: No, it has not been adopted. The Central Bank of Myanmar (CBM) has consistently issued warnings against the use of cryptocurrencies and has stated that they are not legal tender. There is no specific legislation or guidance that enables or regulates Virtual Asset Service Providers (VASPs), let alone implements the Travel Rule.
Effective Date: Not applicable. Since the Travel Rule has not been adopted, there is no effective date.
Technical Implementation Requirements: Not applicable. No regulatory framework means no technical implementation requirements for the Travel Rule.
Specific Legal Basis: The amendments to the Law on Anti-Money Laundering and Combating Terrorism Financing (date of amendment for virtual assets is generally understood to be around 2020-2021) are the primary source for VASP obligations. Detailed regulations or implementing acts by the FRC would further specify the registration process and requirements.
No Dedicated Definition: Mongolia's regulatory framework does not appear to have a specific, separate legal definition of a "qualified custodian" for digital assets, distinct from the broader definition of a "Virtual Asset Service Provider (VASP)" or other regulated financial entities.
Ongoing Development: The FRC has expressed intentions to further develop the regulatory framework for virtual assets to promote a secure and transparent market environment. This generally implies a continuous process of legislative and regulatory refinement.
No Specific "Custody Law" Announced: As of now, there is no public announcement of distinct, pending legislation solely focused on digital asset custody, separate from the broader VASP and AML/CFT framework. Any future developments are more likely to come in the form of amendments to existing laws, new implementing regulations issued by the FRC, or a more comprehensive virtual asset law that might include specific custody provisions.
No Dedicated Crypto-Specific Sanctions List: Mongolia does not currently maintain a separate "crypto-specific" sanctions list.
Application of General Lists: Any national sanctions lists that Mongolia might maintain (e.g., a list of domestic terrorists or proliferators, if distinct from the UN list) would apply to all financial transactions, including those involving cryptocurrencies, once VASPs are fully integrated into the financial regulatory framework. The AML/CFT Law generally mandates the implementation of UN Security Council resolutions.
It is highly probable that the GDT, possibly in conjunction with the FRC, will issue specific tax guidance or amendments to existing tax laws as the virtual asset market in Mongolia matures and regulatory frameworks evolve globally.
The Financial Regulatory Commission (FRC) of Mongolia is the primary regulator for VASPs and is responsible for licensing, supervision, and enforcement.
The VASP Law broadly covers entities engaged in virtual asset services. Article 4.1 defines a VASP as an entity that, on behalf of another natural or legal person, conducts any of the following activities:
AML/KYC Requirements: Mauritania does have general Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) laws, which are largely based on FATF recommendations. While these laws apply broadly to financial institutions, their direct applicability to unregulated virtual asset activities is unclear. However, any interaction with the traditional financial system (e.g., converting crypto to fiat through a Mauritanian bank) would trigger the bank's existing AML/KYC obligations. Operators would be advised to implement robust AML/KYC practices voluntarily to mitigate risks and demonstrate good faith, especially if future regulations are introduced. The Cellule Nationale de Traitement des Renseignements Financiers (CENAREF) is Mauritania's Financial Intelligence Unit (FIU) responsible for AML/CFT oversight.
No Defined Process: Since there is no specific regulatory framework or license for virtual asset services, there is no defined application process for such a license in Mauritania.
Risk of Future Regulation: The absence of regulation does not mean permissibility. Mauritania could, at any time, introduce new laws, including bans, strict licensing requirements, or even retroactive measures.
International Standards: Operators should monitor international standards, particularly those from the Financial Action Task Force (FATF), as many countries, including Mauritania, often align their AML/CFT frameworks with FATF recommendations. The FATF has issued guidance for a risk-based approach to virtual assets and virtual asset service providers.
Requirements for VASPs: All UN member states, including Mauritania, are obligated to implement sanctions resolutions adopted by the UN Security Council (UNSC). This means any financial entity, including a VASP, must:
Requirements for VASPs: While OFAC sanctions are primarily U.S. law, their extraterritorial reach is significant due to the global dominance of the U.S. dollar and the U.S. financial system. Any VASP, regardless of its location, that deals with U.S. persons, uses U.S. dollar clearing services, or processes transactions that touch the U.S. financial system, must comply with OFAC sanctions.
Requirements for VASPs: EU sanctions apply to all persons and entities operating within EU jurisdiction, and to EU persons and entities operating anywhere in the world. Non-EU VASPs dealing with EU persons or entities, or processing transactions involving EU-based assets, should consider EU sanctions.
Sanctions List Screening: Regular and ongoing screening of all customers, beneficial owners, and transaction counterparties against the UN Consolidated List, OFAC SDN List, and the EU Consolidated List. This extends to wallet addresses associated with known sanctioned entities or illicit activities.
Real-time & Batch Screening: Implementing both real-time screening for new onboarding and transactions, and batch screening for existing customer bases as sanctions lists are updated.
Under OFAC/EU Sanctions (Extraterritorial): Even without direct Mauritanian enforcement, a VASP that violates OFAC or EU sanctions could face:
Communiqué de la Banque Centrale de Mauritanie sur les Monnaies Virtuelles (Cryptomonnaies):
Legal Basis (Indirect): The relevant legislation would be Loi N° 2013-057 portant sur les systèmes et moyens de paiement en République Islamique de Mauritanie (Law N° 2013-057 on payment systems and means in the Islamic Republic of Mauritania), and subsequent implementing regulations or circulars from the BCM regarding payment service providers and e-money. This law defines and regulates various payment instruments and services.
Requirement for Licensing (by analogy): Any entity seeking to issue stablecoins and offer related services would almost certainly be required to obtain a license from the Banque Centrale de Mauritanie (BCM) as a financial institution or a licensed payment service provider, in accordance with Loi N° 2013-057 and BCM regulations. Operating without such a license would be illegal.
Mauritania has not publicly announced any plans or initiated pilot programs for a Central Bank Digital Currency (CBDC).
If Mauritania were to introduce a CBDC, it would likely become the primary digital currency issued by the state, potentially leading to stringent regulations or even restrictions on private stablecoins to ensure financial stability and monetary sovereignty.
Regulatory Approach: Ban
Not Legal Tender: The Central Bank of Mauritania (BCM) has repeatedly warned against the use of cryptocurrencies, stating they are not legal tender and are not regulated by the BCM. They have highlighted risks such as volatility, lack of consumer protection, and potential for illicit activities.
Anti-Money Laundering (AML) Considerations: Mauritania has AML laws. Large or suspicious transactions involving conversion of crypto to fiat (or vice-versa, if handled by regulated entities) could potentially trigger scrutiny by financial intelligence units, even if there are no specific crypto tax reporting rules. Banks and other financial institutions would likely report such transactions if they are deemed suspicious.
General Directorate of Taxes (Direction Générale des Impôts - DGI): This is the primary body for tax collection and enforcement. While a direct, stable English-language URL for the Mauritanian DGI's specific tax codes is challenging to find, their activities fall under the Ministry of Finance.
Whether Adopted: No, the FATF Travel Rule has not been adopted or implemented in Mauritania. Instead, the country has opted for a prohibition of virtual asset transactions.
Virtual Asset and Initial Token Offering Services Act 2021 (VAITOS Act 2021): This Act defines various virtual asset services and mandates licensing for providers.
Amendments and Updates: The FSC continuously monitors the virtual asset landscape and international best practices (e.g., FATF guidance). As such, there may be ongoing updates, amendments to the existing Rules, or new Guidance Notes issued to clarify or strengthen specific aspects of VASP operations, including custody.
Focus on Licensing & Prevention: Mauritius's strategy for virtual assets is heavily focused on comprehensive licensing and strong AML/CFT compliance before an entity can operate. This means many non-compliant entities are prevented from entering the market or have their applications rejected, rather than being fined after operating illegally.
Enforcement Action Publication Policy: While the FSC publishes enforcement actions, they might not always detail specific financial penalties for every type of breach, especially if it leads to license revocation or denial rather than a fine for a fully licensed entity. Public notices are more likely to cover broad warnings or general licensing updates.
Required License: A VASP license issued by the FSC to conduct "Exchange services."
A comprehensive business plan outlining the proposed activities, target market, operational procedures, risk management framework, financial projections, and technological infrastructure.
Under the UN Sanctions Act 2019:
Primary Sanctions List: The UN Consolidated List is the foundational sanctions list that Mauritian VASPs are legally obliged to screen against. The FIU Mauritius typically issues circulars or guidance to regulated entities to ensure they access and comply with the latest UN lists.
Domestic Implementation: The UN Sanctions Act 2019 enables the Minister (upon advice from the Attorney General) to publish a notice in the Gazette to give effect to any UN Security Council Resolution for targeted financial sanctions. This effectively makes the UN list enforceable domestically.
No Crypto-Specific List: There is no separate Mauritian list of "sanctioned crypto entities" or "sanctioned crypto addresses" distinct from general sanctions lists. However, VASPs are expected to integrate sanctions screening into their blockchain analytics and transaction monitoring tools to identify sanctioned wallets or addresses.
Security Token: Explicitly defined as a virtual asset that "meets the definition of a 'security' under the Securities Act 2005." This is the direct link.
Whitepaper and Disclosure: A comprehensive whitepaper must be submitted to and approved by the FSC, providing clear and transparent information about the token, its functionality, risks, and the project.
Regulated Exchanges: Secondary trading of security tokens is generally expected to occur on a licensed securities exchange (like the Stock Exchange of Mauritius for traditional securities) or an FSC-approved market specifically designed for security tokens.
Licensing and Compliance: The primary enforcement mechanism is ensuring entities comply with licensing requirements under the VAITOS Act (for VASPs and ITOs) and the Securities Act (for security tokens). Operating without the necessary license or approval would be a significant breach.
Anti-Money Laundering (AML) Compliance: A significant area of enforcement and supervision for the FSC relates to AML/CFT compliance for all virtual asset service providers and ITOs, aligning with FATF standards.
Significant Fines: Both for individuals and corporate entities.
Virtual Asset: The VAITOS Act defines a "Virtual Asset" as "a digital representation of value that can be digitally traded or transferred and used for payment or investment purposes and includes a digital representation of value which is used as a medium of exchange, a unit of account or a store of value." Most stablecoins, by nature, fit this broad definition, particularly asset-backed ones.
E-money: If a stablecoin primarily functions as electronic money, representing a claim on fiat currency and used for payment services (e.g., a fiat-backed stablecoin directly redeemable 1:1 for a national currency and widely accepted for payments), it could fall under the purview of the Bank of Mauritius (BOM) and the National Payment Systems Act 2018. The BOM regulates e-money issuers and payment service providers. This could lead to a dual licensing requirement (FSC for Virtual Asset Service Provider and BOM for e-money issuer) or require clarification from authorities.
Auditing and Reporting: Regular audits and reporting to the FSC would scrutinize the financial health and backing of any issued stablecoins.
Interaction with Private Stablecoins: A CBDC would be a liability of the central bank, offering the highest form of monetary stability and trust. Private stablecoins, while also aiming for stability, remain liabilities of private entities.
Comprehensive: Mauritius has enacted specific primary legislation, the Virtual Asset and Initial Token Offering Services Act 2021 (VAITOS Act), along with accompanying rules and guidelines, to regulate the virtual asset sector from end-to-end. This covers licensing, conduct of business, consumer protection, and AML/CTF.
Proactive: The regulatory framework was designed to align with international best practices and recommendations for virtual assets and Virtual Asset Service Providers (VASPs).
Not a Ban or Partial: Crypto trading and related services are not banned; instead, they are legally permitted but subject to stringent licensing and oversight.
Investor Protection: The regulatory framework aims to protect investors by ensuring licensed entities meet specified standards for security, transparency, and integrity.
Regulatory Framework: Mauritius has implemented a robust regulatory framework for virtual assets through the Virtual Asset and Initial Token Offering Services Act 2021 (VAITOS Act 2021), administered by the Financial Services Commission (FSC). This Act focuses on licensing and regulating Virtual Asset Service Providers (VASPs) to ensure consumer protection, market integrity, and compliance with international AML/CFT standards. While this is a regulatory act and not a tax act, it provides the legal basis for how virtual assets are defined and treated in the broader financial landscape, which could eventually inform future tax guidelines.
VASP Registration/Licensing: However, entities providing custodial services for virtual assets would likely fall under the definition of a Virtual Asset Service Provider (VASP) as defined by the AML/CFT Act and subsequent regulations. VASPs are subject to AML/CFT obligations and may require registration or licensing with the MMA/FIU.
No specific mandates: The Maldivian regulatory framework does not include specific technical requirements or mandates for the use of cold storage (offline storage) for client digital assets. Custodians are expected to implement appropriate security measures, but the specifics of how they secure assets (e.g., hot vs. cold storage percentages) are not dictated by regulation.
However, as a member of the global financial community and subject to FATF recommendations, the Maldives is expected to continually review and update its AML/CFT framework, and potentially expand its virtual asset regulations beyond just AML/CFT in the future, especially as the FATF continues to evolve its guidance on VAs and VASPs. Any future updates would likely be announced by the MMA.
Focus on AML/CFT: While there isn't a specific crypto regulatory framework, the Maldives, as a member of the Asia/Pacific Group on Money Laundering (APG), is working to strengthen its Anti-Money Laundering and Counter-Terrorist Financing (AML/CFT) regime. This includes addressing virtual assets in line with FATF recommendations, but this is more about developing future regulations rather than current enforcement actions against existing crypto businesses.
Mandatory Obligation: As a member of the United Nations, the Maldives is legally obligated to implement sanctions resolutions adopted by the UN Security Council (UNSC). These resolutions target individuals and entities involved in terrorism financing, proliferation financing, and other threats to international peace and security.
Screening: VASPs must continuously screen their customers (both at onboarding and on an ongoing basis) against the UN sanctions lists.
Reporting: VASPs are required to report any hit or potential hit against UN sanctions lists to the FIU and relevant authorities.
Legal Reference: The implementation of UN Security Council Resolutions is mandated under the PMLFTA. Specific resolutions can be found on the UN website: UN Security Council Sanctions Committees
Not Directly Legally Binding (for Maldives-only entities): While OFAC (U.S. Department of the Treasury's Office of Foreign Assets Control) and EU sanctions are not directly legally binding on Maldivian entities operating solely within the Maldives and not involving US/EU persons or jurisdictions, they are critically important for practical and reputational reasons.
Correspondent Banking and De-risking: Maldivian financial institutions, including those dealing with VASPs, rely heavily on correspondent banking relationships with international banks (many of which are in the US or EU). Failure to comply with OFAC or EU sanctions can lead to these international banks terminating relationships, effectively cutting off access to the global financial system ("de-risking").
International Transactions: Any VASP facilitating transactions with individuals, entities, or jurisdictions subject to OFAC or EU sanctions, or using services from US/EU-based blockchain infrastructure providers, wallets, or exchanges, would be directly exposed to these sanctions.
Best Practice: Adhering to OFAC and EU sanctions lists (e.g., Specially Designated Nationals and Blocked Persons List - SDN List) is a widely recognized best practice for global AML/CFT compliance, even for jurisdictions not directly subject to them.
Screening: Maldivian VASPs, especially those with international operations or ambitions, are expected to screen their customers against OFAC and EU sanctions lists as part of their risk management and enhanced due diligence processes.
Mandatory: VASPs in the Maldives must implement robust systems and procedures for screening customers, beneficial owners, and transactions against relevant sanctions lists (UN, and practically OFAC/EU).
Risk-Based Approach: The Maldives does not typically impose outright blanket bans on crypto transactions with specific countries (beyond UN sanctions). Instead, its AML/CFT framework mandates a risk-based approach.
CMDA Enforcement Powers: If an offering is deemed an unregistered security, the CMDA has the power to:
None Specific: There are no specific reserve requirements for stablecoin issuers in the Maldives, as there is no specific regulatory framework for stablecoins.
Exploration Stage: The MMA has indicated that it is looking into the feasibility and implications of introducing a CBDC. This is part of a broader global trend where central banks are examining digital versions of their national fiat currencies.
Potential Impact: If the Maldives were to issue a CBDC, it would likely serve as the primary digital form of the Maldivian Rufiyaa, potentially impacting the demand for and regulatory approach to private stablecoins pegged to the MVR. A CBDC would offer a risk-free digital payment instrument directly from the central bank, which could set a benchmark for how private stablecoins might eventually be regulated or interact with the official digital currency ecosystem.
The MMA has issued advisories and warnings stating that virtual assets like cryptocurrencies are not legal tender in the Maldives and are not regulated by the MMA.
This regulatory stance further underscores the absence of a defined legal and tax framework for cryptocurrencies.
Adopted: Yes, the Maldives has adopted the FATF Travel Rule through the Regulation on Virtual Asset Service Providers (VASPs) issued by the Maldives Monetary Authority (MMA).
Effective Date: The VASP Regulation was approved by the MMA Board on 1st December 2022 and officially came into force on 1st January 2023. This regulation mandates VASPs to comply with AML/CFT obligations, including those related to the Travel Rule.
Official Statements/News: The Reserve Bank of Malawi has indicated that it is exploring the potential for a comprehensive regulatory framework for cryptocurrencies and potentially a Central Bank Digital Currency (CBDC). This suggests that new legislation or amendments to existing financial laws are being considered or drafted.
RBM's Consistent Stance: The Reserve Bank of Malawi has repeatedly stated that cryptocurrencies are not legal tender in Malawi and are not regulated by the RBM. They have warned the public about the inherent risks, including volatility, cyber-attacks, and potential for fraud, as these assets operate outside the regulated financial system.
Emerging Regulatory Framework: Malawi has been working towards establishing a regulatory framework for virtual assets. In late 2023, the National Assembly passed the Virtual Assets Service Providers (VASP) Bill. This bill aims to regulate virtual assets and virtual asset service providers, bringing them under the supervision of the Financial Intelligence Authority (FIA) and potentially the Reserve Bank of Malawi in the future.
Not Applicable: There is no specific licensing regime for stablecoin issuers. Entities issuing or facilitating stablecoins without appropriate licenses for other financial services (e.g., banking, e-money issuance) would be operating outside the regulatory perimeter and potentially in violation of existing financial laws.
Existing Licensing: Any entity wishing to issue e-money in Malawi must be licensed by the Reserve Bank of Malawi under the National Payment Systems Act, 2017, but this does not currently extend to what are typically understood as stablecoins.
No Legal Guarantee: As stablecoins are not regulated or recognized under Malawian law, there are no legally enforceable redemption rights guaranteed by the Malawian regulatory framework. Redemption would depend solely on the terms and conditions provided by the private issuer, with no recourse to Malawian regulatory bodies.
Exploration Stage: The Reserve Bank of Malawi has indicated an interest in exploring the potential of a Central Bank Digital Currency (CBDC). In a speech in 2022, the then RBM Governor, Dr. Wilson Banda, mentioned that the RBM was conducting research and feasibility studies into a CBDC.
Reserve Bank of Malawi Public Notice on Virtual Assets (Cryptocurrencies)
The MRA's approach is to apply and interpret existing tax laws (Income Tax Act, Taxation Act, VAT Act) to cover cryptocurrency activities. This is a common approach in jurisdictions that are still evolving their digital asset regulatory frameworks.
Regulatory Warnings: It's also important to note that the Reserve Bank of Malawi (RBM) has previously issued warnings about the risks associated with virtual assets, stating that they are not legal tender and are not regulated by the RBM. While this isn't a tax matter, it informs the broader regulatory environment that influences how tax authorities view these assets.
Reserve Bank of Malawi Public Warnings/Statements on Cryptocurrencies: The RBM has repeatedly issued warnings regarding the use of cryptocurrencies due to lack of regulation and associated risks.
AML/CFT and Targeted Financial Sanctions for Financial Institutions (AML/CFT TFS for FIs) Policy Document (BNM Policy Document): Issued by Bank Negara Malaysia, this comprehensive policy document provides detailed guidance and requirements for reporting institutions to comply with AMLATFPUAA 2001. This document has specific sections/appendices applicable to "Digital Currencies" or "Virtual Assets."
Bank Negara Malaysia (BNM):
Recipient: Reports must be submitted to the Financial Intelligence Unit (FIU) within Bank Negara Malaysia.
Sanctions Screening: Implement measures to screen customers and transactions against targeted financial sanctions lists issued by the United Nations Security Council (UNSC) and domestic authorities to prevent terrorism financing and proliferation financing.
Penalty Amount: No explicit monetary fine was announced at the time of the public reprimand. The penalties were operational: a public reprimand, an order to cease all operations in Malaysia, disable access to its website and mobile applications, and cease all media and marketing activities targeting Malaysian investors.
Outcome: Binance was forced to shut down its direct operations in Malaysia. Malaysian users were advised to withdraw their funds. The action led Binance to later pursue a compliant pathway to re-enter the Malaysian market by acquiring a stake in and partnering with a licensed local Digital Asset Exchange (DAX), MX Global, demonstrating the effectiveness of the SC's enforcement in driving regulatory compliance.
Penalty Amount: Typically no specific monetary penalty is announced publicly for being added to the alert list. The "penalty" is a public warning, which often leads to the platform being unable to operate effectively in Malaysia and subsequent cessation of operations or blocking of access.
Securities Commission Malaysia (SC) Guidelines on Digital Assets: These guidelines, particularly the latest amendments, impose specific AML/CTF requirements on DAX operators (VASPs) licensed by the SC. They mandate the implementation of policies and procedures to prevent money laundering and terrorism financing, which inherently includes sanctions compliance.
Bank Negara Malaysia (BNM) Policy Document on Anti-Money Laundering, Countering Financing of Terrorism and Targeted Financial Sanctions (AML/CFT and TFS Policy Document): This document sets out the regulatory requirements for financial institutions, including reporting institutions dealing with digital assets, regarding AML/CTF and targeted financial sanctions. It is mandatory for VASPs to adhere to the principles and requirements outlined in this policy.
Direct Implementation: Malaysia implements UN Security Council Resolutions (UNSCRs) related to targeted financial sanctions (TFSR) through the AMLA 2001 and specific Ministerial Orders.
Indirect Applicability & Risk: Malaysian VASPs may not be legally compelled by Malaysian law to enforce OFAC sanctions directly, but practical and commercial realities dictate compliance:
VASP Obligations: Due to these risks, prudent Malaysian VASPs typically screen their customers and transactions against OFAC's Specially Designated Nationals (SDN) List and other sanctions lists (e.g., related to Cuba, Iran, North Korea, Syria, Russia) as a best practice for risk management.
VASP Obligations: Similar to OFAC, many Malaysian VASPs will screen against EU sanctions lists (e.g., the EU Sanctions Map or Consolidated List of Persons, Groups, Entities Subject to EU Financial Sanctions) as part of their robust compliance programs.
Best Practice Screening: Given the indirect applicability of OFAC and EU sanctions, and the global nature of crypto, leading VASPs in Malaysia will also screen against:
Methods: Screening should leverage reliable, up-to-date sanctions databases, often through third-party compliance software solutions that integrate multiple sanctions lists and provide continuous monitoring.
Sanctioned Jurisdictions: Transactions with jurisdictions under comprehensive UN sanctions are strictly prohibited. This primarily includes North Korea and Iran (subject to specific proliferation financing sanctions). Engaging in transactions with these countries, directly or indirectly, through digital assets is a severe violation.
As E-Money/Payment Token (Regulated by Bank Negara Malaysia - BNM):
Bank Negara Malaysia (BNM) is actively exploring the potential issuance of a Central Bank Digital Currency (CBDC). BNM has stated its focus on understanding the strategic implications of a CBDC for Malaysia, conducting research and engaging with stakeholders.
Legality: Engaging in crypto trading and establishing crypto exchanges is legal, provided they comply with the SC's regulatory framework.
Compliance with Regulatory Bodies: Businesses operating Digital Asset Exchanges (DAXs) or offering digital assets must comply with reporting requirements set by the Securities Commission Malaysia (SC) and Bank Negara Malaysia (BNM) for Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT). This includes reporting suspicious transactions.
Bank Negara Malaysia (BNM): Focuses on the financial stability implications of digital assets and plays a key role in developing regulatory frameworks for anti-money laundering and counter-financing of terrorism (AML/CFT) related to virtual assets.
Sanctions Screening: Both originator and beneficiary information must be screened against relevant sanctions lists.
Fines: Significant monetary penalties, which can run into millions of Ringgit for entities.
Revocation or Suspension of Licenses: For regulated entities like DAXes, their licenses can be revoked or suspended by the SC or BNM.
Enforcement Actions: BNM and SC have the power to issue directives, impose administrative penalties, or take other enforcement actions.
Banco de Moçambique's Position: The BdM has repeatedly issued warnings and communiqués stating that cryptocurrencies are not legal tender in Mozambique, are not regulated by the central bank, and transactions involving them are high risk. They emphasize that there is no official protection for consumers or investors in virtual assets.
No Specific Licenses: As a direct consequence of the above, there are no specific cryptocurrency exchange licenses, crypto custody licenses, or crypto payment processor licenses issued by the BdM or any other Mozambican authority for entities dealing solely in virtual assets.
Neither for Pure Crypto: For entities operating purely in virtual assets (e.g., crypto-to-crypto exchanges), neither a dedicated registration nor a licensing regime exists. They are currently operating in an unregulated space from a specific virtual asset perspective.
Licensing for Traditional Financial Services: If an entity's operations involve traditional financial services (e.g., fiat-to-crypto exchanges, crypto payment processors that handle fiat currency, or entities holding fiat funds for crypto purchases), then they might fall under the existing financial licensing requirements supervised by the Banco de Moçambique or other financial regulators, depending on the specific nature of their activities. This would be interpreted under existing laws such as: