DeFi protocol frontend in Eswatini

An investment of money or assets: The investor commits capital to acquire the token.

In a common enterprise: The investment is pooled with others, or the value of the token is tied to a broader project or business venture managed by others.

With an expectation of profits: The investor anticipates financial gain (e.g., capital appreciation, dividends, revenue sharing, or other forms of return) from holding the token.

Derived solely or substantially from the efforts of others: The profits are expected to come from the managerial or entrepreneurial efforts of a third party (the issuer, promoter, or other entities), rather than the investor's own efforts.

Security Tokens: These are tokens explicitly designed to represent traditional financial instruments.

Licensing: Issuers, promoters, or financial intermediaries involved in offering or distributing securities may need to be licensed by the FSRA as financial services providers (e.g., investment advisors, brokers, collective investment scheme managers).

Prospectus Requirements: For public offerings of securities, a comprehensive prospectus must be prepared and registered with the FSRA. This prospectus must disclose all material information relevant to the investment, risks, and the issuer.

Eswatini's Financial Services Regulatory Authority licenses no virtual-asset trading platform and operates no securities-exchange licence class that reaches crypto-asset trading; the Central Bank of Eswatini's 2023 notice records that cryptocurrencies are not legal tender in Eswatini and that crypto investments or assets are currently unregulated there, so no Eswatini instrument makes crypto trading either licensable or unlawful. A digital-asset regulatory framework administered by a body called the FSRA belongs to the Abu Dhabi Global Market, not to Eswatini.

Eswatini operates no virtual-asset licensing regime: neither the Central Bank of Eswatini nor the Financial Services Regulatory Authority licenses virtual asset service providers, and the only hook is AML-side, created by the Anti-Money Laundering, Counter-Financing of Terrorism and Counter-Proliferation Financing (Miscellaneous Amendments) Act 2024, which directs supervisory authorities to establish a framework to regulate VASPs and under which VASPs are treated as accountable institutions registering with the Eswatini Financial Intelligence Centre.

Eswatini's primary AML/CFT statute is the Money Laundering and Financing of Terrorism (Prevention) Act, 2011 (Act 6 of 2011), as amended by Act 5 of 2016, whose section 19 establishes the financial intelligence body first named the Swaziland Financial Intelligence Unit and now operating as the Eswatini Financial Intelligence Centre; Eswatini has no Financial Intelligence Unit Act, the Prevention of Organised Crime Act 2018 deals with organised crime and confiscation rather than accountable-institution duties, and the 2011 Act as consolidated carries no definition of virtual assets, VASPs, cryptocurrency or digital currency.

FATF Recommendations: Eswatini, through its membership in ESAAMLG, is expected to continue enhancing its legal framework to fully comply with FATF Recommendation 15 on new technologies and Virtual Asset Service Providers (VASPs). This implies that future amendments or new regulations could introduce more specific requirements for VASPs, which might eventually encompass more detailed aspects of custody.

Recommendation 15 (New Technologies): Specifically applies AML/CFT obligations to VASPs, including the obligation to implement sanctions screening.

Recommendation 6 (Targeted Financial Sanctions): Requires countries to implement targeted financial sanctions related to terrorism and WMD proliferation without delay.

Evidence fact sz.aml.united-nations-un-sanctions not found (may have been renamed).

ISIL (Da'esh) & Al-Qaida Sanctions List: Maintained by the 1267/1989/2253 Committee.

Taliban Sanctions List: Maintained by the 1988 Committee.

Other UN Sanctions Regimes: Pertaining to specific countries (e.g., Democratic People's Republic of Korea, Iran, Libya, Yemen, etc.) and individuals/entities associated with violations of peace and security.

Eswatini's AML statute is the Money Laundering and Financing of Terrorism (Prevention) Act, 2011 (Act 6 of 2011), amended by Act 5 of 2016, and the Prevention of Organised Crime Act, 2018 supplies asset-recovery powers, but United Nations Security Council targeted financial sanctions are given domestic effect by the Anti-Money Laundering (United Nations Security Council Resolutions) Regulations, 2016 together with the Suppression of Terrorism Act as amended by Act No. 11 of 2017, with the Ministry of Foreign Affairs and International Cooperation acting as the gateway for UNSC 1267 and 1373 listings; section 19 of the 2011 Act establishes the financial intelligence unit as the Swaziland Financial Intelligence Unit, the single body that now operates as the Eswatini Financial Intelligence Centre, and Eswatini was rated Non-Compliant on Recommendations 6 and 7 in the June 2022 ESAAMLG mutual evaluation.

U.S. Sanctions (OFAC):

Jurisdictional Nexus: A VASP in Eswatini becomes subject to OFAC sanctions if:

Central Bank of Eswatini (CBE) Public Statement on Virtual Assets (Cryptocurrencies)

The Central Bank of Eswatini issued no cryptocurrency or virtual-asset statement on 28 January 2021. Its published crypto communications are an April 2018 announcement that the Bank was researching cryptocurrency, and the 2023 notice 'Considerations for Dealing in Cryptocurrencies', which states that cryptocurrencies have no legal tender status in Eswatini and that crypto investments or assets are currently unregulated.

The Central Bank of Eswatini's 2023 notice 'Considerations for Dealing in Cryptocurrencies' states that cryptocurrencies 'do not exist physically and have no legal tender status in Eswatini' and that 'crypto investments or assets are currently unregulated in Eswatini; therefore, investors do not benefit from the legal protection associated with regulated instruments or products'. It is a consumer warning addressed to the public that directs readers to verify a provider's licence with the Central Bank of Eswatini and the Financial Services Regulatory Authority; it contains no directive to financial institutions and imposes no obligation.