Is Crypto Legal in Madagascar?
Cryptocurrency is legal but heavily restricted in Madagascar. The jurisdiction has a restrictive regime with banking or trading constraints, and an active legislative process underway. Central Bank of Madagascar is among the 2 regulators with oversight. Primary legislation: Law No. 2023-002 of July 27, 2023, on Investments.
Derived from 369 sourced facts for Madagascar · last updated · primary sources
Overview
Madagascar operates without a dedicated virtual asset regulatory framework — no specific law mandates licensing for cryptocurrency exchanges, custody providers, or payment processors — while the Banque Centrale de Madagascar (BCM) maintains a cautious to potentially prohibitive stance toward crypto activity. General AML/CFT obligations under Loi n° 2018-043 (2018), overseen by Madagascar's Financial Intelligence Unit, implicitly extend to entities facilitating virtual asset transfers or exchanges, requiring customer identity verification, beneficial ownership identification, and reporting duties, though application to VASPs lacks explicit regulatory guidance. The most decision-relevant risk is the BCM's historically discouraging posture, meaning crypto operations exist in a legally ambiguous space where activities are technically unrestricted yet potentially subject to implicit prohibition under broader financial regulation.
Regulatory Bodies
Banque Centrale de Madagascar (BCM - Central Bank of Madagascar)
Autorité des Marchés Financiers de Madagascar (AMF - Financial Markets Authority of Madagascar)
Operating Models
9/9 verdictsCan specific business models operate in Madagascar? Each card answers the operational question for one kind of operator. Curated cells reflect counsel-grade review; AI-generated cells should be confirmed before relying on them.
Conditional · low burden.
AI · UnreviewedConditional · no licensing.
AI · UnreviewedConditional · low burden.
AI · UnreviewedConditional · high burden.
AI · UnreviewedConditional · high burden.
AI · UnreviewedConditional · medium burden.
AI · UnreviewedConditional · no licensing.
AI · UnreviewedConditional · low burden.
AI · UnreviewedConditional · low burden.
AI · UnreviewedPrimary Legislation
| Law / Regulation | Year | Scope |
|---|---|---|
| Law No. 2023-002 of July 27, 2023, on Investments | 2023 | The primary general investment law is the Investment Code (Law No. 2023-002 of July 27, 2023, on Investments), which confirms the rights of foreign and domestic private parties to establish and own business enterprises, but it contains no… |
Licensing Requirements
Such activities are currently unrestricted but carry significant legal and operational risks due to the absence of specific protections or guidelines.
Such activities may be implicitly restricted or discouraged under broader financial regulations, or even face outright prohibitions from the Central Bank.
No Specific Crypto Licensing Regime: There is no specific law or regulation mandating licenses for cryptocurrency exchanges, custody providers, or virtual asset payment processors in Madagascar, unlike jurisdictions that have implemented frameworks like MiCA (EU), MAS (Singapore), or VARA (Dubai).
Central Bank Caution/Warnings: The Banque Centrale de Madagascar (BCM) – the country's central bank and primary financial regulator – has historically maintained a cautious, if not prohibitive, stance towards cryptocurrencies. They have likely issued public warnings about the risks associated with virtual assets, including price volatility, lack of consumer protection, and potential for illicit finance. These warnings often imply that crypto is not recognized as legal tender and regulated financial institutions should not facilitate their use.
AML/CFT Implications: While there are no crypto-specific AML/CFT regulations, Madagascar, as a member of the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) and subject to FATF recommendations, has general anti-money laundering and combating the financing of terrorism (AML/CFT) laws. The Cellule de Renseignement Financier (CRF) is Madagascar's Financial Intelligence Unit.
In the absence of specific VASP regulations, these general AML/CFT laws could be interpreted to apply to entities dealing with virtual assets, especially if they interact with the traditional financial system. However, without specific guidance, the application remains ambiguous.
FATF Recommendation 15 specifically calls for countries to regulate and supervise VASPs for AML/CFT purposes. Madagascar is expected to implement these recommendations, which could lead to future regulations.
Registration vs. Licensing Regime: Currently, neither a dedicated registration nor a licensing regime for VASPs exists in Madagascar.
Exchanges (Fiat-to-Crypto/Crypto-to-Crypto): There are no specific licenses required. However, if an exchange facilitates fiat currency transactions (e.g., MGA deposits/withdrawals), it might inadvertently touch upon existing payment services regulations overseen by the BCM, potentially requiring a payment service provider license for the fiat portion of its operations.
Custody Providers: No specific licenses are required for virtual asset custody.
Payment Processors (Virtual Assets): No specific licenses are required for processing payments in virtual assets. Similar to exchanges, if these services involve conversion to or from fiat currency, they may fall under existing electronic payment service regulations.
Capital Requirements: Sufficient capital to cover operational risks, ensure solvency, and protect customer assets (amounts would vary based on the scope of services).
AML/KYC Compliance: Robust Anti-Money Laundering (AML) and Know Your Customer (KYC) policies and procedures, including transaction monitoring, suspicious activity reporting, and customer due diligence, in line with FATF recommendations.
Local Presence: Typically, a locally incorporated entity (e.g., a company registered in Madagascar) with a physical presence and local management.
Governance and Management: Fit and proper tests for directors and senior management, demonstrating competence, integrity, and sound governance.
Technology and Security: Adequate IT infrastructure, cybersecurity measures, and data protection protocols to safeguard customer data and assets.
Consumer Protection: Measures to protect consumers, including clear terms of service, dispute resolution mechanisms, and transparent fee structures.
Role: The primary financial regulator responsible for monetary policy, banking supervision, and payment systems. Any future crypto regulation is likely to originate from or be overseen by the BCM.
Note: You would need to navigate their site for official press releases, financial circulars, or any statements regarding digital currencies. Information is predominantly in French and Malagasy.
Role: Madagascar's Financial Intelligence Unit, responsible for combating money laundering and terrorist financing. They would be crucial in developing and enforcing AML/CFT aspects of any future VASP regulation.
Note: Their site contains information on Madagascar's AML/CFT framework, which would be the general legal basis for any future VASP-specific AML requirements.
High Regulatory Risk: Operating a cryptocurrency business in Madagascar currently carries significant regulatory risk due to the absence of clear rules. This can lead to uncertainty regarding legality, potential for sudden regulatory changes, or difficulties in interacting with traditional financial institutions.
Evolving Landscape: The global regulatory landscape for virtual assets is rapidly evolving. Madagascar, like other countries, is under pressure from international bodies (like FATF) to address VASP regulation. This situation could change at any time with the introduction of new laws or decrees.
Legal Advice is Crucial: It is highly recommended that any entity considering operating a virtual asset business in Madagascar seek specific legal advice from a local Madagascan law firm specializing in financial law. They can provide the most up-to-date interpretation of existing laws and advise on potential risks and compliance obligations, especially concerning general business law, tax, and potential indirect application of financial regulations.
Legal Tender Status: Cryptocurrencies are not recognized as legal tender in Madagascar.
Banque Centrale de Madagascar (BCM - Central Bank of Madagascar)
Role: The BCM is responsible for monetary policy, financial stability, and the regulation of banking and payment systems. It has taken the lead in issuing warnings due to the potential risks crypto poses to financial stability, consumer protection, and anti-money laundering efforts.
Autorité des Marchés Financiers de Madagascar (AMF - Financial Markets Authority of Madagascar)
Role: Regulates financial markets, securities, and investment services. Could potentially become involved if virtual assets were to be classified as securities.
Avertissement de la Banque Centrale de Madagascar concernant les opérations effectuées en crypto-monnaies (Warning from the Central Bank of Madagascar regarding operations carried out in crypto-currencies)
Content: This official communiqué warns the public about the risks associated with using, holding, or investing in cryptocurrencies. Key points include:
Cryptocurrencies are not recognized as legal tender.
They are not regulated by any Madagascan financial authority.
Users are exposed to high risks of fraud, cybercrime, money laundering, and terrorist financing.
There is no legal protection or recourse for users in case of loss or fraudulent activities.
The BCM strongly advises against engaging in cryptocurrency operations.
Reference (URL): The communiqué is usually found in the "Avertissements aux publics" section of the BCM website. While direct PDF links can change, here's where to look:
Trading: Crypto trading by individuals is strongly discouraged and undertaken at one's own risk. The BCM's warning highlights that there is no legal protection or recourse for traders. While not explicitly illegal in a legislative sense (e.g., you won't be arrested for holding crypto), engaging in it is done outside any recognized or regulated financial system, making it high-risk.
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.
AML/KYC Requirements
Absence of Crypto-Specific Laws: There are no laws specifically regulating the issuance, trading, or use of cryptocurrencies in Madagascar.
General AML/CFT Framework: The primary legal framework for combating money laundering and terrorist financing is:
Law No. 2004-020 on Combating Money Laundering and Terrorist Financing (and subsequent amendments).
Note: While this law predates widespread crypto adoption, its general principles concerning suspicious transactions, customer due diligence (CDD), and reporting obligations are expected to apply to any financial activity, including those involving virtual assets, where a nexus to traditional finance or an underlying crime can be established.
Financial Intelligence Unit (FIU): The Cellule de Renseignement Financier de Madagascar (CEN-FIC) is Madagascar's FIU responsible for receiving, analyzing, and disseminating suspicious transaction reports (STRs) or suspicious activity reports (SARs). VASPs or entities dealing with crypto in Madagascar, even without specific crypto regulation, would likely fall under CEN-FIC's purview for AML/CFT compliance if they interact with the formal financial system.
FATF Grey List Status: Madagascar's inclusion on the FATF Grey List means that it is actively working with the FATF to address strategic deficiencies in its AML/CFT regime. This necessitates enhanced due diligence by international financial institutions and VASPs when dealing with Madagascan entities or individuals.
Obligation for Madagascar: Madagascar is legally bound to enforce all UN Security Council (UNSC) sanctions regimes.
VASP Compliance Requirements: Any VASP, regardless of its location, that serves customers in Madagascar, processes transactions involving Madagascan entities or individuals, or operates in Madagascar, must:
Screen against the UN Consolidated Sanctions List: This list includes individuals and entities designated under various UN sanctions regimes (e.g., terrorism, proliferation, specific country regimes).
Prohibit transactions with sanctioned entities/individuals.
Report any hits or suspicious activity to relevant authorities (e.g., CEN-FIC).
UN Security Council Resolutions: Found on the UN website, e.g., via the Sanctions Committees: https://www.un.org/securitycouncil/sanctions/information
UN Consolidated Sanctions List: https://www.un.org/securitycouncil/content/un-sc-consolidated-list
Extraterritorial Application: Any VASP, globally, is subject to OFAC sanctions if it:
Is a U.S. person (citizen, permanent resident, entity incorporated in the U.S., or operating in the U.S.).
Engages in transactions that touch U.S. persons or entities.
Facilitates transactions for persons on OFAC's lists, regardless of their location.
VASP Compliance Requirements: VASPs with a U.S. nexus or those dealing with U.S. persons/systems must:
Screen against the Specially Designated Nationals and Blocked Persons (SDN) List: This is OFAC's primary sanctions list.
Screen against other OFAC sanctions lists (e.g., Sectoral Sanctions Identifications List, Non-SDN Menu-Based Sanctions List).
Implement geographic restrictions: Block transactions to comprehensively sanctioned jurisdictions (e.g., Cuba, Iran, North Korea, Syria, certain regions of Ukraine/Russia).
Monitor transactions for red flags indicative of sanctions evasion or illicit finance.
OFAC Guidance on Virtual Currency: OFAC has issued specific guidance on sanctions compliance for virtual currency:
Persons or entities within the EU.
EU nationals, wherever they are located.
Entities incorporated or constituted under the law of an EU Member State.
Activities taking place, in whole or in part, within the EU.
Any person in respect of business done in whole or in part within the EU.
VASP Compliance Requirements: VASPs with a U.S. nexus or those dealing with U.S. persons/systems must:
Screen against the EU Consolidated List of Sanctions: This list includes individuals and entities designated under various EU sanctions regimes.
EU Sanctions Map (overview of all regimes): https://www.sanctionsmap.eu/
Council Regulations: Specific EU regulations outlining sanctions regimes are published in the Official Journal of the European Union, accessible via EUR-Lex: https://eur-lex.europa.eu/homepage.html
Customer Due Diligence (CDD): Screen all new and existing customers (individuals and entities) against relevant sanctions lists during onboarding and on an ongoing basis.
Beneficial Ownership: Identify and screen ultimate beneficial owners (UBOs) of corporate customers.
Transaction Monitoring: Screen transactions in real-time or near real-time for direct or indirect involvement of sanctioned parties or sanctioned jurisdictions.
FATF Recommendations: FATF Recommendation 15 specifically addresses virtual assets and VASPs, requiring them to implement AML/CFT measures, including sanctions screening, similar to traditional financial institutions.
Madagascar itself is not a comprehensively sanctioned jurisdiction by the UN, OFAC, or the EU.
However, VASPs must implement geographic restrictions that block transactions to and from individuals or entities located in sanctioned countries (e.g., Cuba, Iran, North Korea, Syria, certain regions of Ukraine/Russia) as dictated by OFAC, EU, and UN sanctions programs.
Madagascar (Domestic): While there are no crypto-specific penalties, violations of Madagascar's AML/CFT Law No. 2004-020 can result in:
Imprisonment: For individuals involved in money laundering or terrorist financing.
Loss of business licenses or ability to operate.
Civil Penalties: Can range from thousands to millions of U.S. dollars per violation, often determined by a base penalty amount multiplied by factors like egregiousness and cooperation.
Criminal Penalties: For willful violations, individuals can face significant prison sentences and fines up to millions of dollars, while corporations can face fines in the tens of millions.
EU Violations: Penalties for breaches of EU sanctions are determined by individual Member States but are required to be "effective, proportionate and dissuasive." They can include:
Imprisonment: For individuals, particularly for serious or willful breaches.
Reputational Damage: Significant negative impact on a company's standing.
None. Madagascar does not maintain its own specific sanctions list that explicitly targets crypto entities or individuals involved in virtual asset transactions. Its compliance obligations stem from its domestic AML/CFT law (which applies broadly to financial crimes) and its adherence to international (UN) sanctions.
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.
Threshold Amounts: As the Travel Rule is not adopted, there are no established threshold amounts for its application in Madagascar.
Which VASPs are Covered: Without specific legislation or regulations, there is no clear definition or coverage of VASPs for the purpose of the Travel Rule in Madagascar. The existing AML/CFT law may generally apply to financial institutions, but a specific framework for virtual asset service providers is absent or nascent.
Technical Implementation Requirements: Since the Travel Rule is not implemented, there are no defined technical implementation requirements for VASPs in Madagascar.
Penalties for Non-Compliance: Without specific laws or regulations governing the Travel Rule or defining VASP obligations in this regard, there are no specific penalties for non-compliance with the Travel Rule. Any penalties would fall under general AML/CFT legislation for unregistered financial activities, if virtual asset activities are deemed to fall under existing financial services definitions, which is often ambiguous without specific VA legislation.
FATF Jurisdictions under Increased Monitoring (Grey List): Madagascar is listed here, indicating ongoing strategic deficiencies.
FATF Website - Jurisdictions under Increased Monitoring
FATF Website - Madagascar's Mutual Evaluation Report (2018) (You'll find the 2018 ME report and subsequent follow-up reports here, which would indicate the state of R.15 implementation).
FATF Website - Guidance for VA and VASPs (Updated 2021)
Travel Rule
Madagascar has not enacted any specific cryptocurrency or digital asset legislation, and no dedicated regulatory framework for virtual assets exists as of 2025–2026. Madagascar Travel Advisory | Travel.State.gov
No government authority in Madagascar has been designated to regulate, license, or supervise cryptocurrency exchanges, wallet providers, or other virtual asset service providers (VASPs). Madagascar Travel Advice & Safety | Smartraveller
No travel-rule requirements (FATF Recommendation 16) have been implemented in Madagascar's legal system, and no VASP has been granted a license to operate in the country. Madagascar - Traveler view | Travelers' Health | CDC
The Central Bank of Madagascar (Banque Centrale de Madagascar) has issued cautionary statements about cryptocurrency risks, but these do not constitute a licensing or registration regime. Madagascar Travel Advisory | Travel.State.gov
Madagascar's absence from FATF mutual evaluation reports on virtual assets means the country has not been assessed for compliance with the travel rule or other crypto-related FATF standards. Madagascar Travel Advice & Safety | Smartraveller
Madagascar's financial sector is primarily regulated by the Banque Centrale de Madagascar (BCM), the central bank, and the Commission de Supervision Bancaire et Financière (CSBF), but neither has published any binding regulation specifically addressing cryptocurrencies or digital assets. Madagascar Travel Advisory | Travel.State.gov
The primary financial legislation in Madagascar includes Law No. 2004-020 on the status of the Banky Foiben'i Madagasikara (the central bank), and Law No. 2007-023 on banking and financial activities, but neither law mentions virtual assets. Madagascar Travel Advice & Safety | Smartraveller
Madagascar's general anti-money laundering framework is based on Law No. 2018-020 on the fight against money laundering and the financing of terrorism, which predates the FATF's 2019 amendments extending AML/CFT obligations to virtual assets. Madagascar - Traveler view | Travelers' Health | CDC
The Financial Intelligence Unit of Madagascar, known as SAMIFIN (Service Autonome de Mise en œuvre de la norme Internationale sur la lutte contre le blanchiment de capitaux et le Financement du terrorisme), operates under the Ministry of Economy and Finance but has not issued any guidance for VASPs. Madagascar Travel Advisory | Travel.State.gov
Madagascar is a member of the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG), a FATF-style regional body, and underwent its most recent mutual evaluation in 2018–2019, before the FATF reinforced its travel-rule standards for VASPs. Madagascar Travel Advice & Safety | Smartraveller
Madagascar's FATF mutual evaluation report did not assess virtual asset service providers because the country did not report any VASP activity at that time, and no follow-up report has addressed crypto assets since. Madagascar - Traveler view | Travelers' Health | CDC
The SAMIFIN operates as Madagascar's FIU under Article 2 of Decree No. 2017-095, but its mandate covers traditional financial institutions and designated non-financial businesses, not cryptocurrency businesses. Madagascar Travel Advisory | Travel.State.gov
The island nation does not participate in any international pilot program or bilateral arrangement for implementing the FATF travel rule for crypto transfers. Madagascar - Traveler view | Travelers' Health | CDC
No licensing or registration regime exists in Madagascar for cryptocurrency exchanges, custodial wallet providers, or other virtual asset service providers. Madagascar Travel Advisory | Travel.State.gov
The Banque Centrale de Madagascar does not offer any type of license, authorization, or permit for crypto-related business activities. Madagascar Travel Advice & Safety | Smartraveller
Zero entities have been licensed, registered, or authorized to conduct cryptocurrency business in Madagascar, as no legal pathway exists for such authorization. Madagascar - Traveler view | Travelers' Health | CDC
No capital requirements, minimum paid-up capital thresholds, or prudential standards have been set for crypto businesses because no licensing framework exists. Madagascar Travel Advisory | Travel.State.gov
There is no application process, timeline, or fee schedule for obtaining a crypto license in Madagascar, and no authority has been designated to receive such applications. Madagascar Travel Advice & Safety | Smartraveller
Malagasy commercial companies that wish to engage in crypto activities are subject only to the general business registration requirements under the OHADA (Organisation pour l'Harmonisation en Afrique du Droit des Affaires) Uniform Act on Commercial Companies, but this does not constitute specialized crypto licensing. Madagascar - Traveler view | Travelers' Health | CDC
With no VASP licensing regime, the travel-rule obligation to collect and share beneficiary and originator information for crypto transfers cannot be enforced on any entity in Madagascar. Madagascar Travel Advisory | Travel.State.gov
The absence of licensing means that no Malagasy authority can impose travel-rule technical standards, such as the "sunrise issue" threshold of USD 1,000 for VASP-to-VASP transfers. Madagascar Travel Advice & Safety | Smartraveller
Madagascar's Law No. 2018-020 on anti-money laundering and counter-terrorism financing applies to "financial institutions" and "designated non-financial businesses and professions," categories that do not expressly include VASPs. Madagascar Travel Advisory | Travel.State.gov
Customer due diligence (CDD) obligations under Law No. 2018-020 require identification of clients, verification of identity using official documents, and understanding the purpose of the business relationship, but these obligations have not been extended to crypto transactions. Madagascar Travel Advice & Safety | Smartraveller
Enhanced due diligence (EDD) provisions exist in Madagascar's AML law for politically exposed persons (PEPs) and high-risk customers, as defined in Article 10 of Law No. 2018-020, but no guidance applies these to crypto activities. Madagascar - Traveler view | Travelers' Health | CDC
Suspicious transaction reporting (STR) obligations are in place under Article 12 of Law No. 2018-020, requiring covered entities to report suspicious transactions to SAMIFIN, but since VASPs are not covered entities, no crypto-related STR obligations exist. Madagascar Travel Advisory | Travel.State.gov
Record retention requirements in Madagascar's AML framework mandate keeping transaction records for at least 10 years, but no specific record-keeping rules exist for virtual asset transfers or travel-rule data. Madagascar Travel Advice & Safety | Smartraveller
Beneficial ownership identification requirements were introduced through amendments to the OHADA Uniform Act and implementing decrees in Madagascar, but these apply to corporate entities and not to crypto wallet addresses or pseudonymous transactions. Madagascar - Traveler view | Travelers' Health | CDC
PEP screening obligations apply to Malagasy financial institutions under Article 10 of Law No. 2018-020, but there is no mechanism for crypto businesses to access any national PEP database or screening tool. Madagascar Travel Advisory | Travel.State.gov
The SAMIFIN's UNIPLUS reporting system, an electronic platform for filing STRs, is accessible only to declared financial entities and does not accept reports from crypto-related businesses. Madagascar Travel Advice & Safety | Smartraveller
Madagascar's AML framework does not include any provision requiring the collection, verification, or transmission of originator and beneficiary information for virtual asset transfers, which is the essence of the FATF travel rule. Madagascar - Traveler view | Travelers' Health | CDC
No public record exists of any enforcement action, fine, penalty, or prosecution in Madagascar related to cryptocurrency, digital assets, or violations of travel-rule obligations, because no such legal obligations exist. Madagascar Travel Advisory | Travel.State.gov
Zero entities have been sanctioned, fined, or otherwise penalized by Malagasy authorities for crypto-related AML/CFT failures, including travel-rule non-compliance. Madagascar Travel Advice & Safety | Smartraveller
No Malagasy court case has interpreted or applied any law to cryptocurrency activities, and there is no jurisprudence on the legal status of virtual assets. Madagascar - Traveler view | Travelers' Health | CDC
The Banque Centrale de Madagascar issued a public warning in 2019 cautioning the public about the risks of using virtual currencies, but this warning did not name any specific entity and did not result in any regulatory action. Madagascar Travel Advisory | Travel.State.gov
SAMIFIN has not published any notices, sanctions lists, or enforcement reports related to cryptocurrency activities in Madagascar. Madagascar Travel Advice & Safety | Smartraveller
No tax guidance has been issued for virtual assets in Madagascar. Madagascar - Traveler view | Travelers' Health | CDC
The General Tax Code of Madagascar (Code Général des Impôts) contains no provisions addressing the taxation of cryptocurrency gains, mining income, staking rewards, or crypto-to-fiat conversions. Madagascar Travel Advisory | Travel.State.gov
Madagascar's income tax framework under the General Tax Code applies to "revenues" and "profits" of individuals and companies, but no administrative interpretation has clarified whether crypto trading profits constitute taxable revenues. Madagascar Travel Advice & Safety | Smartraveller
No capital gains tax regime has been specifically applied to digital assets, and no guidance exists on whether gains from crypto sales would be treated as capital gains or business income. Madagascar - Traveler view | Travelers' Health | CDC
The value-added tax (VAT) framework under Madagascar's General Tax Code, which applies to goods and services supplied in the country, has not been extended to crypto exchange services or transaction fees. Madagascar Travel Advisory | Travel.State.gov
The Direction Générale des Impôts (DGI), Madagascar's tax authority, has not published any circular, ruling, or administrative guidance concerning cryptocurrency or virtual assets. Madagascar Travel Advice & Safety | Smartraveller
Malagasy tax residents holding cryptocurrency do not have any specific reporting obligations for their digital asset holdings, unlike the reporting requirements for foreign bank accounts under the tax code. Madagascar - Traveler view | Travelers' Health | CDC
The single most significant gap is that Madagascar has no legal definition of virtual assets or VASPs, creating complete legal uncertainty for any business operating in this space. Madagascar Travel Advisory | Travel.State.gov
A business conducting cryptocurrency operations in Madagascar cannot comply with the FATF travel rule because the law neither requires nor enables the collection and transmission of originator/beneficiary information for crypto transfers. Madagascar Travel Advice & Safety | Smartraveller
Without a designated regulator for virtual assets, no entity in Madagascar has the authority to issue licenses, conduct inspections, or enforce compliance, leaving a complete regulatory vacuum. Madagascar - Traveler view | Travelers' Health | CDC
The practical reality is that crypto businesses operate in a grey zone: they are not prohibited, but they are also not recognized, protected, or regulated by Malagasy law. Madagascar Travel Advisory | Travel.State.gov
Risks include the inability to open bank accounts or access payment rails, as Malagasy banks are themselves uncertain about the legal status of crypto-related businesses. Madagascar Travel Advice & Safety | Smartraveller
There is a risk that crypto transactions could be deemed to fall within Madagascar's general AML/CFT obligations by a court, despite the law not naming VASPs, creating retroactive compliance exposure. Madagascar - Traveler view | Travelers' Health | CDC
International counterparties applying the FATF travel rule may refuse to transact with Malagasy-based VASPs because those VASPs cannot provide compliant travel-rule data, effectively isolating Madagascar from global crypto markets. Madagascar Travel Advisory | Travel.State.gov
Madagascar's ESAAMLG membership creates an expectation of eventual FATF-aligned regulation of VASPs, and the country's failure to do so may affect its standing in future mutual evaluations. Madagascar Travel Advice & Safety | Smartraveller
The legal vacuum also means no investor protection, no consumer recourse, and no dispute resolution mechanism exists for crypto users in Madagascar, exposing them to total loss in the event of fraud or platform failure. Madagascar - Traveler view | Travelers' Health | CDC
Public statements by the central bank warning against crypto use, while not legally binding, create reputational risk for any licensed-adjacent business activity and may discourage legitimate operators. Madagascar Travel Advisory | Travel.State.gov
Madagascar Travel Advisory | Travel.State.gov
Madagascar Travel Advice & Safety | Smartraveller
Madagascar - Traveler view | Travelers' Health | CDC
Tax Reporting
Tax reporting data collection in progress.
Custody Requirements
No verified facts yet. 12 unverified fact(s) in explorer
Stablecoin Regulation
Most Likely: E-money/Payment Tokens (if MGA-denominated and backed): If a stablecoin is pegged to the Malagasy Ariary (MGA) and aims to facilitate payments, it would most likely fall under the existing framework for electronic money (e-money). The BCM regulates e-money issuers and payment service providers.
Definition of E-money: Typically, e-money is defined as electronically stored monetary value represented by a claim on the issuer, issued on receipt of funds, and accepted as a means of payment by persons other than the e-money issuer.
Less Likely: Securities: Stablecoins are generally designed to maintain a stable value, unlike traditional securities which aim for capital appreciation. However, if a stablecoin's terms and conditions were structured to offer an expectation of profit or an investment return beyond simple redemption, or if it represents an ownership interest in an underlying asset pool in a manner that constitutes a collective investment scheme, it could potentially be classified as a security under general corporate or financial laws, though this is less common for typical stablecoins.
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 not classified as E-money: There would be no specific reserve requirements beyond general prudential rules for financial institutions, unless specifically mandated by a future bespoke regulation.
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.
If not classified as E-money: No specific stablecoin issuer license exists. However, operating any financial service, including potentially the issuance or exchange of digital assets, could trigger other licensing requirements (e.g., as a financial institution, payment service provider, or potentially a money services business) depending on the exact nature of the activity.
If classified as E-money: A fundamental principle of e-money regulation is the right to redeem the e-money at par for fiat currency at any time, free of charge (or at a reasonable, pre-disclosed fee). This would apply directly to a stablecoin classified as e-money.
If not classified as E-money: Redemption rights would depend entirely on the terms and conditions set by the stablecoin issuer, potentially subject to general consumer protection laws, but without specific regulatory backing for 1:1 redemption.
No Specific Rules: Madagascar currently has no specific rules or prohibitions regarding algorithmic stablecoins. Given their inherent volatility and lack of direct fiat or asset backing, such stablecoins would likely face significant scrutiny.
Potential Challenges: If an algorithmic stablecoin were to gain traction, it would likely be viewed with caution by the BCM due to its potential for instability and consumer risk. It is highly unlikely it would be permitted to operate under an e-money license given the absence of stable backing. Regulators globally are increasingly wary of algorithmic stablecoins, and Madagascar would likely follow suit, potentially prohibiting them or subjecting them to extremely strict conditions.
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).
Future Interaction: If Madagascar were to eventually issue a CBDC, it would likely influence the regulatory landscape for private stablecoins. A CBDC could potentially offer a more secure and regulated digital alternative, possibly leading to tighter controls or even restrictions on private stablecoins to protect monetary sovereignty and financial stability.
Loi n° 2018-006 relative aux services de paiement à Madagascar (Law on Payment Services in Madagascar): This law provides the overarching framework for payment services, including e-money. It defines the activities, licensing requirements, and supervision of payment service providers.
Finding Specific Law Text: This would typically be published in the Official Gazette of Madagascar (Journal Officiel de la République de Madagascar). For direct access, one might need a legal database subscription or direct contact with the BCM or Malagasy legal resources.
BCM Website: The Banque Centrale de Madagascar's official website (often in French) is the primary source for their regulations and pronouncements. Look for sections on "Réglementation des services de paiement" or "Monnaie électronique."
Banque Centrale de Madagascar (BCM) Official Website: https://www.banque-centrale.mg/ (You would need to navigate to "Réglementation" or "Textes Législatifs et Réglementaires" sections).
Règlements/Instructions de la Banque Centrale de Madagascar: The BCM issues specific regulations (règlements) and instructions to implement the broad principles of the payment services law. These would detail requirements for e-money issuance, capital, governance, and operational aspects.
Loi n° 2018-043 relative à la lutte contre le blanchiment de capitaux et le financement du terrorisme (Law on Anti-Money Laundering and Combating the Financing of Terrorism): This law establishes the AML/CFT framework, which would apply to any financial institution or activity, including potentially stablecoin issuers or exchanges, if they are deemed to be financial service providers. Entities handling virtual assets are increasingly subject to AML/CFT obligations globally, and Madagascar's financial intelligence unit (SAMIFIN) would likely oversee this.
SAMIFIN (Service de Renseignement Financier): Madagascar's Financial Intelligence Unit. Their website might have information on AML/CFT laws.
Securities Classification
Madagascar does not have a dedicated cryptocurrency or digital asset securities law as of 2025–2026; there is no specific licensing regime for virtual asset service providers (VASPs) under securities regulation. Did you search a Legal Framework ? | Welcome to SAMIFIN
The primary financial regulator is the Banking and Financial Supervision Commission (CSBF) under Banky Foiben'i Madagasikara (the central bank), while SAMIFIN (the Financial Intelligence Unit) oversees AML/CFT compliance; neither has issued crypto-specific licensing rules. Banking and Financial Supervision Commission, Banky Foiben'i Madagasikara | Welcome to SAMIFIN
The existing legal framework is built on the AML/CFT Law No. 2018-043 of February 13, 2019, as amended by Law No. 2023-026 of February 1, 2024, which applies anti-money laundering obligations to covered entities but does not create a securities license for crypto assets. Did you search a Legal Framework ? | Welcome to SAMIFIN
No entity has been licensed to operate a cryptocurrency exchange, custody provider, or digital asset securities platform in Madagascar, because no such licensing pathway exists. Did you search a Legal Framework ? | Welcome to SAMIFIN
The practical reality is that crypto businesses operate in a legal gray zone: they are subject to AML/CFT obligations and potential money laundering enforcement, but have no legal route to obtain authorization for securities-related crypto activities. Mission et attribution | Portail d'information du SAMIFIN
The principal AML/CFT law in Madagascar is Law No. 2018-043 of February 13, 2019, on the fight against money laundering and terrorist financing, which was amended and supplemented by Law No. 2023-026 of February 1, 2024. Did you search a Legal Framework ? | Welcome to SAMIFIN
Decree No. 2024-1352 of July 3, 2024, implements the amended AML/CFT Law No. 2023-026, providing application measures for the revised legal framework. Did you search a Legal Framework ? | Welcome to SAMIFIN
The financial regulator is the Banking and Financial Supervision Commission (CSBF — Commission de Supervision Bancaire et Financière), operating under Banky Foiben'i Madagasikara (the Central Bank of Madagascar). Banking and Financial Supervision Commission, Banky Foiben'i Madagasikara | Welcome to SAMIFIN
SAMIFIN (Samisahana ho an'ny Fampiharana ny Inspektsy Finansy) is the national Financial Intelligence Unit responsible for receiving and analyzing suspicious transaction reports and coordinating AML/CFT efforts. Mission et attribution | Portail d'information du SAMIFIN
The Coordination and Orientation Committee on AML/CFT was established by Decree No. 2022-937, dated June 2022, to oversee and coordinate national AML/CFT policy. Did you search a Legal Framework ? | Welcome to SAMIFIN
The AML/CFT Directive No. 002/SAMIFIN/DG/23 of June 2023 amends and supplements Directive No. 001/SAMIFIN/DG/22, detailing prevention and detection measures for money laundering and terrorist financing. Did you search a Legal Framework ? | Welcome to SAMIFIN
Directive No. 001/SAMIFIN/DG/CAB/22 of June 14, 2022, addresses the prevention and detection of money laundering and/or terrorist financing and the reporting of suspicious transactions. Did you search a Legal Framework ? | Welcome to SAMIFIN
Instruction No. 001/2022-CSBF of May 2022 amends Instruction No. 006/2007-CSBF on the prevention and fight against money laundering and terrorist financing, and is further amended by Instruction No. 001/2023-CSBF of July 2023. Did you search a Legal Framework ? | Welcome to SAMIFIN
Order No. 15227/2023/MEF of April 2023 governs the declaration and publication of the identity of beneficial owners of public contracts. Did you search a Legal Framework ? | Welcome to SAMIFIN
Law No. 2020-005 on Insurance was enacted in July 2022 within the broader financial regulatory framework. Did you search a Legal Framework ? | Welcome to SAMIFIN
Madagascar is a member of the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG), a FATF-style regional body, and is subject to FATF mutual evaluation standards; however, the specific FATF recommendation on virtual assets (Recommendation 15) has not been implemented through dedicated crypto legislation. Mission et attribution | Portail d'information du SAMIFIN
The Ministry of Economy and Finance (MEF) oversees financial sector policy and is responsible for implementing the AML/CFT framework in coordination with SAMIFIN. Textes sur le CGA - Ministère des Finances et du Budget
There is no securities market regulator with dedicated authority over digital assets; the CSBF regulates banks and financial institutions, and the MEF handles financial policy, but no agency has been assigned oversight of virtual asset securities. Mission et attribution | Portail d'information du SAMIFIN
The legal framework in Madagascar does not include any law, decree, instruction, or directive specifically naming cryptocurrencies, digital assets, virtual assets, or digital securities as regulated instruments. Did you search a Legal Framework ? | Welcome to SAMIFIN
No licensing regime exists for cryptocurrency exchanges, digital asset custodians, crypto brokers, or digital asset securities platforms under Malagasy law as of 2025–2026; there is no legal pathway to obtain such a license. Did you search a Legal Framework ? | Welcome to SAMIFIN
The CSBF issues regulatory instructions for banks and financial institutions under Instruction No. 006/2007-CSBF and its amendments, but these instructions do not cover virtual assets or crypto securities. Did you search a Legal Framework ? | Welcome to SAMIFIN
Banks and financial institutions are subject to licensing requirements under the CSBF, but no such authorization extends to virtual asset service providers because the law does not recognize them as licensable entities. Banking and Financial Supervision Commission, Banky Foiben'i Madagasikara | Welcome to SAMIFIN
There is no minimum capital requirement, application fee, timeline, or structural requirement specified for crypto-related businesses, because no licensing framework for such businesses has been adopted. Did you search a Legal Framework ? | Welcome to SAMIFIN
The AML/CFT obligations imposed by Law No. 2023-026 apply to any institution or person engaged in financial activities as defined by the law, but the definition does not explicitly include digital asset services, leaving a regulatory gap. Did you search a Legal Framework ? | Welcome to SAMIFIN
Zero entities have been licensed to conduct cryptocurrency or digital asset securities activities in Madagascar; official registries published by the CSBF and SAMIFIN list no such licensees. Banking and Financial Supervision Commission, Banky Foiben'i Madagasikara | Welcome to SAMIFIN
The Ministry of Economy and Finance has not issued any license or authorization for blockchain-based securities or tokenized assets; its published regulatory texts cover only traditional financial and public contract matters. Marchés publics - Ministère de l'Economie et des Finances
There is no procedure for registering a virtual asset service provider with any Malagasy authority, and SAMIFIN's published directives do not include registration or licensing provisions for crypto businesses. Did you search a Legal Framework ? | Welcome to SAMIFIN
Customer due diligence (CDD) requirements for financial institutions are established under Directive No. 001/SAMIFIN/DG/CAB/22 of June 14, 2022, which mandates the prevention and detection of money laundering and terrorist financing, including identification of customers. Did you search a Legal Framework ? | Welcome to SAMIFIN
The AML/CFT Law No. 2018-043, as amended by Law No. 2023-026, sets out the legal basis for customer identification, record-keeping, and reporting obligations for covered financial institutions. Did you search a Legal Framework ? | Welcome to SAMIFIN
Enhanced due diligence (EDD) obligations are implemented through Instruction No. 001/2022-CSBF, amended by Instruction No. 001/2023-CSBF of July 2023, which modifies the CSBF's 2007 instruction on money laundering prevention; these rules require additional scrutiny for higher-risk customers and transactions. Did you search a Legal Framework ? | Welcome to SAMIFIN
Suspicious transaction reporting (STR) obligations require covered entities to report suspicious activities to SAMIFIN, as detailed in Directive No. 001/SAMIFIN/DG/CAB/22 and reinforced by Directive No. 002/SAMIFIN/DG/23 of June 2023. Did you search a Legal Framework ? | Welcome to SAMIFIN
Record retention requirements mandate that financial institutions keep transaction and identification records for a period established by the AML/CFT directives, enabling reconstruction of individual transactions if needed. Did you search a Legal Framework ? | Welcome to SAMIFIN
Beneficial ownership identification is required under Order No. 15227/2023/MEF of April 2023, which mandates the declaration and publication of the identity of beneficial owners for public contracts, applying transparency standards to identify ultimate owners. Did you search a Legal Framework ? | Welcome to SAMIFIN
Politically exposed persons (PEP) screening is implicitly required under the AML/CFT framework, as the directives require enhanced scrutiny for high-risk categories of customers, but the specific PEP provisions are contained in the internal procedures of individual institutions rather than in public-facing documents. Did you search a Legal Framework ? | Welcome to SAMIFIN
SAMIFIN is the designated authority to receive STRs and coordinate AML/CFT enforcement, as described in its mission statement and operational directives. Mission et attribution | Portail d'information du SAMIFIN
The AML/CFT directives apply to banks, financial institutions, and other designated non-financial businesses and professions (DNFBPs), but the applicability to virtual asset service providers remains unclear because the definitions in the directives do not explicitly capture crypto businesses. Did you search a Legal Framework ? | Welcome to SAMIFIN
No enforcement actions, fines, penalties, or arrests have been publicly reported by SAMIFIN or the CSBF specifically against cryptocurrency businesses, because crypto activity is not explicitly defined as a regulated offense under Malagasy law. Did you search a Legal Framework ? | Welcome to SAMIFIN
Order No. 15227/2023/MEF on beneficial owner declaration carries potential sanctions for non-compliance in the context of public contracts, but no enforcement case has been published involving digital assets. Did you search a Legal Framework ? | Welcome to SAMIFIN
The Coordination and Orientation Committee on AML/CFT, established by Decree No. 2022-937, has the mandate to coordinate enforcement actions but has not published any enforcement decisions or penalties related to virtual assets. Did you search a Legal Framework ? | Welcome to SAMIFIN
SAMIFIN's legal framework page lists laws, decrees, and instructions but contains no case law, sanction records, or enforcement actions anywhere on the page. Did you search a Legal Framework ? | Welcome to SAMIFIN
The notification letter No. D-CSBF/DRE/TRG-0723-004206, dated June 2023, is the only regulatory communication listed on the legal framework page, but its content pertains to standard CSBF compliance matters and does not reference any crypto enforcement. Did you search a Legal Framework ? | Welcome to SAMIFIN
No tax guidance has been issued for virtual assets in Madagascar; the Ministry of Economy and Finance's published regulatory texts do not contain any provisions addressing the taxation of cryptocurrencies, digital assets, or blockchain transactions. Ministère de l'Economie et des Finances
The Malagasy tax code has not been amended to classify cryptocurrency gains as either income or capital gains, so there is no established tax treatment for profits derived from crypto trading, mining, or staking. Ministère de l'Economie et des Finances
VAT treatment of crypto transactions is undefined; the national tax authority has not issued any circular or directive on whether digital assets are subject to value-added tax. Textes sur le CGA - Ministère des Finances et du Budget
The Ministry of Finance's published legal texts cover financial regulations (CGA = Comptes de Gestion et d'Administration, or management accounts) but contain zero references to virtual asset taxation. Textes sur le CGA - Ministère des Finances et du Budget
Companies engaging in crypto activities cannot rely on any official interpretation or administrative guidance from the Malagasy tax authorities to determine their tax obligations, and no advance tax rulings for crypto businesses have been published. Ministère de l'Economie et des Finances
The most significant gap is the complete absence of a legal definition for cryptocurrencies, virtual assets, or digital securities in Malagasy law, making it impossible for businesses to determine their regulatory obligations. Did you search a Legal Framework ? | Welcome to SAMIFIN
No agency has explicit statutory authority to regulate digital asset securities; the CSBF covers traditional banking and financial supervision, SAMIFIN handles AML/CFT, and the MEF manages fiscal policy, but none has a mandate for crypto. Mission et attribution | Portail d'information du SAMIFIN
FATF Recommendation 15 on virtual assets has not been implemented through any Malagasy law or regulation, leaving Madagascar non-compliant with international standards for crypto supervision. Did you search a Legal Framework ? | Welcome to SAMIFIN
Crypto businesses face the risk of being treated as unauthorized financial institutions under the broad language of Law No. 2018-043 (as amended), which could invite sanctions from the CSBF even though no crypto-specific license exists. Did you search a Legal Framework ? | Welcome to SAMIFIN
The lack of a licensing pathway means that legitimate crypto businesses cannot obtain legal authorization, while illicit actors face no specific penalty for operating an unlicensed exchange, creating perverse incentives. Banking and Financial Supervision Commission, Banky Foiben'i Madagasikara | Welcome to SAMIFIN
Banks in Madagascar are likely to refuse to provide banking services to crypto companies due to regulatory uncertainty, since the CSBF has not issued guidance on whether banks may service VASPs. Banking and Financial Supervision Commission, Banky Foiben'i Madagasikara | Welcome to SAMIFIN
Cross-border crypto transactions involving Madagascar may trigger sanctions or restrictions from foreign counterparties, as international financial institutions require clarity on the legal status of Malagasy crypto entities. Mission et attribution | Portail d'information du SAMIFIN
There is a risk that the courts would apply the general AML/CFT law to crypto businesses by analogy, but without published case law, judicial interpretation remains unpredictable. Did you search a Legal Framework ? | Welcome to SAMIFIN
The implementation gap is acute: SAMIFIN and the CSBF have the institutional capacity to enforce AML/CFT obligations but lack the technical framework to supervise virtual assets, and no specialized unit within SAMIFIN has been tasked with digital asset monitoring. Mission et attribution | Portail d'information du SAMIFIN
Businesses face legal and reputational risk if they operate without authorization, but simultaneously face "jurisdictional void" risk because there is no authority to which they can apply for proper licensing, trapping compliant operators in a state of uncertainty. Did you search a Legal Framework ? | Welcome to SAMIFIN
Did you search a Legal Framework ? | Welcome to SAMIFIN
Mission et attribution | Portail d'information du SAMIFIN
Banking and Financial Supervision Commission, Banky Foiben'i Madagasikara | Welcome to SAMIFIN
Ministère de l'Economie et des Finances
Textes sur le CGA - Ministère des Finances et du Budget
Marchés publics - Ministère de l'Economie et des Finances
Sanctions & Restrictions
Sanctions data collection in progress.
Research & Articles
Regulatory Forecast
high confidenceLikely enforcement action expected around 2026-06-04
Based on 64 historical regulatory events for Madagascar, averaging every 43 days, with increasing regulatory activity.
Recent Updates
Banque Centrale de Madagascar (BCM) URL: https://www.bcm.mg/
Banque Centrale de Madagascar (BCM) URL: https://www.bcm.mg/
No Specific Framework: There is no specific legal or regulatory framework governing the issuance, trading, or cus...
No Specific Framework: There is no specific legal or regulatory framework governing the issuance, trading, or custody of cryptocurrencies in Madagascar.
Banque Centrale de Madagascar (BCM) - Communiqué de Presse du 27 novembre 2018 sur les risques liés aux crypto-monn...
Banque Centrale de Madagascar (BCM) - Communiqué de Presse du 27 novembre 2018 sur les risques liés aux crypto-monnaies: https://www.banque-centrale.mg/index.php/communique-de-presse (You would need to navigate to the Communiqué de Presse section and look for the November 27, 2018 statement, which is in French and Malagasy).
Obligation for Madagascar: Madagascar is legally bound to enforce all UN Security Council (UNSC) sanctions regimes.
Obligation for Madagascar: Madagascar is legally bound to enforce all UN Security Council (UNSC) sanctions regimes.
Extraterritorial Application: Any VASP, globally, is subject to OFAC sanctions if it:
Extraterritorial Application: Any VASP, globally, is subject to OFAC sanctions if it:
OFAC Guidance on Virtual Currency: OFAC has issued specific guidance on sanctions compliance for virtual currency:
OFAC Guidance on Virtual Currency: OFAC has issued specific guidance on sanctions compliance for virtual currency:
Extraterritorial Application: EU sanctions apply to:
Extraterritorial Application: EU sanctions apply to:
Customer Due Diligence (CDD): Screen all new and existing customers (individuals and entities) against relevant s...
Customer Due Diligence (CDD): Screen all new and existing customers (individuals and entities) against relevant sanctions lists during onboarding and on an ongoing basis.
FATF Recommendations: FATF Recommendation 15 specifically addresses virtual assets and VASPs, requiring them to i...
FATF Recommendations: FATF Recommendation 15 specifically addresses virtual assets and VASPs, requiring them to implement AML/CFT measures, including sanctions screening, similar to traditional financial institutions.
However, VASPs must implement geographic restrictions that block transactions to and from individuals or entities loc...
However, VASPs must implement geographic restrictions that block transactions to and from individuals or entities located in sanctioned countries (e.g., Cuba, Iran, North Korea, Syria, certain regions of Ukraine/Russia) as dictated by OFAC, EU, and UN sanctions programs.
EU Violations: Penalties for breaches of EU sanctions are determined by individual Member States but are required...
EU Violations: Penalties for breaches of EU sanctions are determined by individual Member States but are required to be "effective, proportionate and dissuasive." They can include:
None. Madagascar does not maintain its own specific sanctions list that explicitly targets crypto entities or ind...
None. Madagascar does not maintain its own specific sanctions list that explicitly targets crypto entities or individuals involved in virtual asset transactions. Its compliance obligations stem from its domestic AML/CFT law (which applies broadly to financial crimes) and its adherence to international (UN) sanctions.
Banque Centrale de Madagascar (BCM) Communiqué N°001/2023-BCM/DGOPS/SPSF dated January 11, 2023, titled "Avis et Mi...
Banque Centrale de Madagascar (BCM) Communiqué N°001/2023-BCM/DGOPS/SPSF dated January 11, 2023, titled "Avis et Mise en garde aux opérateurs économiques et au public sur les activités liées aux Crypto-monnaies."
Loi n°2019-006 sur les services de paiement: (Law No. 2019-006 on Payment Services) – This law defines and regula...
Loi n°2019-006 sur les services de paiement: (Law No. 2019-006 on Payment Services) – This law defines and regulates payment service providers. If a token functions as a payment instrument, entities providing related services might fall under this law.
Ordonnance n°2022-005 sur les établissements de crédit: (Ordinance No. 2022-005 on Credit Institutions) – This go...
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 foreig...
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 i...
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 l...
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 concre...
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 regulat...
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 Madagasca...
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 Actio...
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 require...
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 Ru...
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...
Technical Implementation Requirements: Since the Travel Rule is not implemented, there are no defined technical implementation requirements for VASPs in Madagascar.
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