Centralized exchange in Botswana

Botswana operates a prior-authorisation licensing regime rather than a registration regime: section 9 of the Virtual Assets Act, 2025 (Act No. 4 of 2025) prohibits unlicensed virtual asset business, section 10 governs the application for a licence, section 11 its issue, section 12 requires a licence holder to have a physical office in Botswana, section 15 empowers NBFIRA to suspend or revoke a licence, section 36 creates general offences and penalties and section 38 provides administrative sanctions.

The Virtual Assets Act, 2025 (Act No. 4 of 2025) is the overarching Botswana framework for virtual assets and virtual asset service providers, commencing 24 January 2025 under S.I. No. 9 of 2025 and repealing the Virtual Assets Act, 2022 by its section 40; it vests licensing and supervision in NBFIRA and maintains two licence types, the virtual asset service provider licence and the issuer of virtual token offerings licence recorded in the section 21 register.

No Virtual Assets Regulations, 2023 taking effect on 26 May 2023 exist in Botswana; the subsidiary-legislation powers are section 42 for rules and section 43 for regulations of the Virtual Assets Act, 2025, the only instrument made under that Act is the Virtual Assets Act (Date of Commencement) Order, 2025, S.I. No. 9 of 2025, and the sole regulations text NBFIRA publishes is headed 'Draft K. M 12.01.2022' over a blank 'Statutory Instrument No. ___ of 2022' made under the repealed 2022 Act.

Evidence fact bw.licensing.exchanges-exchange-between-virtual-assets not found (may have been renamed).

Operating a virtual asset exchange in or from Botswana requires a licence from NBFIRA: section 9 of the Virtual Assets Act, 2025 prohibits unlicensed virtual asset business, and NBFIRA's February 2026 notice revoking PAA Capital (Proprietary) Limited's licence names exchange, transfer, custody and brokerage among the regulated virtual asset services the entity may no longer offer.

Evidence fact bw.licensing.custody-providers-safekeeping-andor-administration not found (may have been renamed).

Custody of client virtual assets is a licensed activity in Botswana: section 23 of the Virtual Assets Act, 2025 is headed 'Custody and protection of customer assets' and imposes obligations on licence holders, section 9 prohibits unlicensed virtual asset business, and NBFIRA's February 2026 PAA Capital notice lists custody among the regulated virtual asset services a revoked licensee may no longer offer.

Evidence fact bw.licensing.payment-processors-transfer-of-virtual not found (may have been renamed).

Transferring virtual assets on behalf of another person is a licensed activity in Botswana: section 26 of the Virtual Assets Act, 2025 is headed 'Transfer of virtual assets' and carries the travel-rule obligation elaborated in NBFIRA's Guidance Note of 10 March 2025, which requires full originator and beneficiary information for transfers of BWP 10 000 or more by natural persons, and NBFIRA's February 2026 PAA Capital notice lists transfer among the regulated virtual asset services.

Evidence fact bw.licensing.legal-entity-and-local-presence not found (may have been renamed).

Applicants must be a company incorporated in Botswana under the Companies Act.

Section 12 of the Virtual Assets Act, 2025 (Act No. 4 of 2025) is headed 'Licence holder to have physical office in Botswana' and requires a licensed virtual asset service provider to maintain a physical office in the country; the requirement is new and had no counterpart in the repealed Virtual Assets Act, 2022.

Senior management and key personnel are expected to be based in Botswana or demonstrate sufficient local oversight.

Botswana has two licence types only, the virtual asset service provider licence and the issuer of virtual token offerings licence recorded in the section 21 register of the Virtual Assets Act, 2025, so no 'Principal VASP Licence' exists; section 27 of that Act is headed 'Minimum capital requirements' but NBFIRA has published no capital figure, and the P500 000 unimpaired-capital floor in the claim has no source in Botswana law.

The Virtual Assets Act, 2025 provides for a virtual asset service provider licence and an issuer of virtual token offerings licence and for no other licence type, so no 'Limited VASP Licence' exists in Botswana; section 27 is headed 'Minimum capital requirements' and carries no published figure, and the P200 000 unimpaired-capital floor in the claim has no source in Botswana law.

The Virtual Assets Act, 2022 imposes no minimum capital on Botswana virtual asset licensees and gives NBFIRA no express power to demand a security deposit or financial guarantee; section 11 conditions the grant of a licence on the applicant being a fit and proper person with adequate resources, infrastructure and staff of appropriate competence, with financial status or solvency weighed under section 11(2)(a). The only Botswana text setting a financial-resources floor is the Virtual Assets Regulations, 2022 that NBFIRA publishes headed "Draft K. M 12.01.2022" with a blank Statutory Instrument number, whose regulation 4(1) would require cash equal to one half of estimated gross operating costs for the next 12 months.

Botswana is actively tightening its AML/CFT financial sanctions regime to address identified weaknesses, indicating the framework is being reformed rather than remaining a stable cornerstone already fully aligned with FATF standards.

Robust Policies and Procedures: VASPs must implement comprehensive internal AML/CFT policies, procedures, and controls.

Section 14(1)(a) of Botswana's Financial Intelligence Act, 2022 requires every specified party, which includes a virtual asset service provider, to designate an anti-money laundering and counter-financing of terrorism compliance officer at management level who is in charge of internal programmes and procedures, record maintenance and the reporting of suspicious transactions, and who must be a fit and proper person; neither that Act, nor the Virtual Assets Act, 2022, nor the Financial Intelligence Regulations, 2022 makes the appointment subject to approval by NBFIRA.

Customer Due Diligence (CDD): Implementing strong CDD measures for all customers, including identifying and verifying the identity of natural and legal persons, and beneficial owners.

Enhanced Due Diligence (EDD): Applying EDD for higher-risk customers or transactions.

Botswana requires a 20-year retention period, not five years. Section 32 of the Financial Intelligence Act, 2022 obliges a specified party, for 20 years, to maintain all records on domestic and international transactions from the date a transaction is concluded, and to keep customer due diligence records, account files, business correspondence and the results of any analysis for 20 years after the termination of a business relationship or an occasional transaction; regulation 18(3)(a) of the Financial Intelligence Regulations, 2022 likewise fixes at least 20 years for records of reports filed with the Financial Intelligence Agency, and an investigatory authority may require longer retention in writing.

Botswana's operative virtual-asset statute is the Virtual Assets Act, 2025 (Act No. 4 of 2025), which commenced on 24 January 2025 by Statutory Instrument No. 9 of 2025 and whose section 40 repeals the Virtual Assets Act, 2022 (Act No. 3 of 2022); the repealed 2022 Act was assented to and commenced on 25 February 2022 and was never numbered Act No. 19 of 2022, nor gazetted on 27 May 2022.

The prohibition on carrying on virtual asset business without a licence is section 9 of Botswana's Virtual Assets Act, 2025 (Act No. 4 of 2025), re-enacting section 9 of the repealed 2022 Act, and it requires a virtual asset service provider licence or an issuer of initial token offerings licence; section 5 of both Acts is instead the Regulatory Authority's power to request information.

Botswana's Virtual Assets Act places its interpretation provisions in section 2, not section 3, section 3 being the application provision; the repealed Virtual Assets Act, 2022 defined a virtual asset service provider as a person who under an agreement, as part of a business, undertakes a virtual asset service on behalf of another person, or who is a dealer or is willing to deal on own account by buying and selling virtual assets at prices set by that person, and the Virtual Assets Act, 2025 re-enacted that definition to cure the drafting deficiency ESAAMLG identified against the FATF standard.

Section 15 of Botswana's Virtual Assets Act, 2022 dealt with suspension or revocation of a licence without notice and imposed no systems-of-control duty; the client-asset provision was section 20, re-enacted as section 23 of the Virtual Assets Act, 2025, which requires a licence holder holding customer virtual assets to maintain in its custody a sufficient amount of each type of virtual asset to meet its obligations to the customer and to meet all prescribed financial requirements, and provides that those assets are held for the customer, are not the property of the licence holder and are not subject to the claims of the licence holder's creditors.

Botswana's Virtual Assets Act, 2022 has no section 15(1)(a) safeguarding duty and the quoted wording about theft, loss or damage appears nowhere in it; the safeguarding obligations are section 20, requiring a licence holder with custody of customer virtual assets to maintain a sufficient amount of each type of virtual asset to meet its obligations to the customer, and section 26, requiring a licence holder to ensure that appropriate measures are put into place for the protection of customers' virtual assets. Those provisions become sections 23 and 32 in the Virtual Assets Act, 2025.

Botswana's Virtual Assets Act, 2022 contains no information-technology or cybersecurity provision and the words cyber and information technology appear nowhere in its text, section 15 being the provision on suspension or revocation of a licence without notice; the quoted robust information technology framework, cybersecurity and operational resilience wording matches Namibia's Cyber Security Rules made under the Virtual Assets Act, 2023 and published in Government Gazette 8200, Government Notice 516 of 1 September 2023.

Botswana's Virtual Assets Act, 2022 had no section 15(1)(d) and imposed no adequate-financial-resources duty in section 15, whose subsection (1) ran only to paragraph (c) and dealt with suspension or revocation without notice; the financial obligation on a custodian was section 20(1)(b), requiring a licence holder to meet all financial requirements as may be prescribed, and the Virtual Assets Act, 2025 adds a dedicated minimum capital requirements provision at section 27. The word insurance appears nowhere in the 2022 Act.

Section 18 of Botswana's Virtual Assets Act, 2022 concerned information on the assignment and transfer of a licence or beneficial ownership and conferred no directive or practice-note power; NBFIRA's instrument-making authority comes from section 4, which lets the Regulatory Authority develop rules, guidance and codes of practice and publish notices, guidelines, bulletins and policies, while the power to make regulations vests in the Minister under section 36 of the 2022 Act and section 43 of the Virtual Assets Act, 2025, which also adds a separate rules power at section 42.

Botswana's proceeds-of-crime statute is the Proceeds and Instruments of Crime Act, Chapter 08:03, as amended by Act No. 28 of 2014 and Act No. 8 of 2018; the Proceeds of Serious Crime Act occupied that same Chapter 08:03 before repeal and no Chapter 08:06 exists, while money-laundering reporting and confiscation-support duties for virtual asset service providers run through the Financial Intelligence Act, 2022 (Act No. 2 of 2022).

Botswana's operative anti-money-laundering statute is the Financial Intelligence Act, 2022 (Act No. 2 of 2022, Chapter 08:07), assented and commenced on 25 February 2022 and amended by the Financial Intelligence (Amendment) Act, 2025 (Act No. 1 of 2025); it repealed the Financial Intelligence Act, 2019, which was Act No. 11 of 2019 and not No. 17, and it binds virtual asset service providers as 'specified parties' with customer due diligence under sections 16 and 20 and twenty-year record keeping under section 32.

NBFIRA's AML/CFT guidance for virtual assets business is the guidance note 'Implementing AML/CFT Programmes', dated 10 March 2025 and issued under section 49(1)(c) of the Financial Intelligence Act, 2022 and section 4(1)(c) of the Virtual Assets Act, 2025; no NBFIRA virtual-asset AML/CFT guidance note bearing a November 2022 date is published.

Evidence fact bw.aml.identification-and-verification-of-customers not found (may have been renamed).

National identity number (e.g., Omang for citizens), passport number, or other official identification document number.

Residential address (verified with utility bills, bank statements, or other official documents).

Source of funds and source of wealth (especially for high-risk customers or large transactions).

Purpose and intended nature of the business relationship.

Evidence fact bw.aml.beneficial-ownership-identification not found (may have been renamed).

VASPs must identify and verify the identity of the beneficial owner(s) of customers, including for legal persons and legal arrangements.

Botswana sets its beneficial-ownership identification threshold at more than 10 per cent of shares, voting rights or other ownership interest, under the Financial Intelligence Regulations, 2022 (Statutory Instrument No. 14 of 2022), so the 25 per cent test used in other jurisdictions understates the identification duty owed by Botswana virtual asset service providers.

Evidence fact bw.aml.ongoing-due-diligence-and-monitoring not found (may have been renamed).

Monitoring the business relationship and transactions undertaken throughout the course of the relationship to ensure they are consistent with the VASP's knowledge of the customer, their business, risk profile, and, where necessary, the source of funds.

Keeping customer information up-to-date and verifying it periodically.

NBFIRA is the Regulatory Authority for virtual asset service providers under the Virtual Assets Act, 2025 (Act No. 4 of 2025), and it has issued named public warnings against unlicensed providers, including YellowOcta.com Trading Company on 13 September 2022, Berry Crypto Trading Platform on 12 December 2022 and FS Global Properties Limited Botswana on 13 March 2023, and it revoked PAA Capital (Proprietary) Limited's licence in February 2026 under section 15(b) of that Act.

Botswana's operative virtual-asset statute is the Virtual Assets Act, 2025 (Act No. 4 of 2025), which commenced on 24 January 2025 under the Virtual Assets Act (Date of Commencement) Order, 2025, S.I. No. 9 of 2025, and whose section 40 repeals the Virtual Assets Act, 2022 (Act No. 3 of 2022); section 9 prohibits unlicensed virtual asset business, section 11 governs the issue of licences, and NBFIRA is the Regulatory Authority exercising supervisory and enforcement powers under the Act.

NBFIRA publishes named public notices against virtual asset service providers in Botswana, comprising unlicensed-provider warnings against YellowOcta.com Trading Company on 13 September 2022, Berry Crypto Trading Platform on 12 December 2022 and FS Global Properties Limited Botswana on 13 March 2023, and a February 2026 notice revoking the licence of PAA Capital (Proprietary) Limited under section 15(b) of the Virtual Assets Act, 2025; none of these notices states a monetary penalty.

The Bank of Botswana declared on 10 November 2021 that crypto assets carry no backing by the state or the central bank as to legal tender status, transferability, exchange or value, and that the public has no recourse to the Bank for fraud, misconduct or losses arising from crypto-asset business; licensing and supervision of virtual asset service providers rest with NBFIRA under the Virtual Assets Act, 2025 (Act No. 4 of 2025), not with the Bank of Botswana.

The Financial Intelligence Agency is Botswana's financial intelligence unit under the Financial Intelligence Act, 2022 (Act No. 2 of 2022), receiving suspicious transaction reports through the goAML platform within five working days and licensing nobody, while NBFIRA is the AML/CFT supervisory authority for virtual asset service providers; ESAAMLG's September 2025 follow-up report records that Botswana has not yet identified and assessed the money-laundering and terrorist-financing risks of virtual asset activities and VASPs, leaving Recommendation 15 rated partially compliant.