Tanzania -- Stablecoin Regulations Regulatory Overview

Tanzania has enacted no stablecoin instrument and no statutory definition of a stablecoin: the Bank of Tanzania's regulations register lists 51 instruments and its guidelines register 50, none of them addressing virtual assets, and of 286 Bank of Tanzania public notices only three concern crypto-assets, being the cryptocurrency notices of 12 and 29 November 2019 and the central bank digital currency progress notice of 14 January 2023.

The National Payment Systems Act, 2015 (Act No. 4 of 2015) defines electronic money as monetary value represented by a claim on its issuer, electronically stored, issued against receipt of funds of an amount not lesser in value than the monetary value issued, accepted by persons other than the issuer and redeemable in cash, a definition that excludes a virtual asset, and the Act carries no occurrence of virtual, crypto, digital asset or virtual asset; Tanzania's payment instruments are the Payment Systems (Licensing and Approval) Regulations, 2015 and the Electronic Money Regulations, 2015, and no Payment Systems Regulations of 2021 exist.

The Capital Markets and Securities Act, Chapter 79 (Act No. 5 of 1994) is Tanzania's securities statute, and its text carries no occurrence of virtual, crypto, digital asset or token; the Capital Markets and Securities Authority has published no crypto-asset or stablecoin position in any of its principal legislation, guidelines, rules, circulars or regulations indexes.

No Tanzanian instrument imposes reserve requirements on stablecoin issuers: the Bank of Tanzania's regulations register lists 51 instruments and none addresses virtual assets, and reserve and safeguarding duties in Tanzanian payment law attach only to electronic money issuers licensed under the National Payment Systems Act, 2015.

Potential (If classified as E-money): If a stablecoin were classified as e-money, it would likely be subject to the prudential requirements for e-money issuers under the Payment Systems Regulations, 2021. These typically include:

Maintaining reserves equivalent to the value of e-money issued.

Safeguarding customer funds (e.g., segregating funds, holding them in low-risk assets).

Capital adequacy requirements for the issuer.

Tanzania operates no licensing regime for stablecoin issuers: the Bank of Tanzania licenses payment systems, payment instruments and electronic money issuers under the National Payment Systems Act, 2015, which carries no virtual-asset term, and no Tanzanian authority licenses or supervises virtual asset service providers.

The Bank of Tanzania licenses payment systems under sections 5 to 11, payment instruments under sections 15 to 19 and electronic money issuers under sections 24 to 29 of the National Payment Systems Act, 2015, implemented by the Payment Systems (Licensing and Approval) Regulations, 2015 and the Electronic Money Regulations, 2015; no Payment Systems Regulations of 2021 exist and none of those licences extends to stablecoin issuance.

No Tanzanian law confers redemption rights on stablecoin holders; the only statutory redemption feature in Tanzanian payment law belongs to electronic money, which the National Payment Systems Act, 2015 defines as capable of being redeemed in cash, and Tanzania has enacted no stablecoin instrument.

Current Status: There are no specific rules or prohibitions regarding algorithmic stablecoins. Given the general lack of regulation for any type of stablecoin, algorithmic ones are not singled out.

Potential (Future): Globally, algorithmic stablecoins are viewed as inherently riskier due to their reliance on code and market mechanisms rather than fully backed reserves. If Tanzania were to regulate stablecoins, it is highly probable that algorithmic stablecoins would face stricter scrutiny, higher capital requirements, or even outright prohibition, especially for public use in the financial system.

The Bank of Tanzania's public notice of 14 January 2023 states that the Bank has adopted a phased, cautious and risk based approach to adoption of a central bank digital currency and that it remains at the research stage, having formed a multidisciplinary technical team to examine practical aspects of CBDC; the Bank has run no pilot and has taken no decision either to issue or to reject a central bank digital currency.

A Tanzanian CBDC would likely compete with private stablecoins (especially those pegged to TZS).

The introduction of a CBDC might prompt the BoT to develop a clearer regulatory stance on private stablecoins. They could be seen as complementary (e.g., if private stablecoins operate under strict supervision) or as potential risks to monetary sovereignty and financial stability, leading to tighter restrictions or even prohibitions on private stablecoins.

The BoT's general cautious approach to private cryptocurrencies suggests that a state-backed digital currency would be preferred, with private stablecoins potentially facing significant hurdles to operate.

The Bank of Tanzania Act, 2006:

The Bank of Tanzania Act, 2006 (Act No. 4 of 2006) is the principal legislation governing the functions and powers of the Bank of Tanzania, and its section 26 gives the Bank the sole right to issue bank notes and coins which shall be the only legal tender in Tanzania, the provision the Bank invoked with section 27 in its cryptocurrency public notice of 12 November 2019; supervision of banks rests on the Banking and Financial Institutions Act, 2006 and supervision of payment systems on the National Payment Systems Act, 2015.

Reference: While a direct online official gazette link for the full text can be elusive, the Act is published in the Official Gazette of Tanzania.

BoT Website (General Information): https://www.bot.go.tz/

Tanzania's payment statute is the National Payment Systems Act, 2015 (Act No. 4 of 2015), whose long title covers the regulation and supervision of payment systems, electronic payment instruments, electronic money, payment system service providers, netting arrangements and settlement finality, with licensing obligations for payment system operation, issuance of electronic payment instruments and issuance of electronic money; the Act contains no reference to virtual assets, virtual currency, cryptocurrency, digital currency or stablecoins, and its definition of electronic money requires monetary value issued against receipt of funds and redeemable in cash, which excludes a stablecoin.

Reference: Tanzania Government Printer or legal databases.

BoT Payment Systems Page (General Information): https://www.bot.go.tz/PaymentSystem/

The Payment Systems Regulations, 2021:

Tanzania has no 'Payment Systems Regulations, 2021'; the Bank of Tanzania's Regulations register carries no such instrument. The subsidiary rules on licensing, operation and oversight of payment service providers and electronic money issuers are the Payment Systems Licensing and Approval Regulations, 2015 and the Electronic Money Regulations, 2015, both made under the National Payment Systems Act, 2015, and neither contains any virtual-asset, cryptocurrency or stablecoin term.

The Bank of Tanzania's cryptocurrency warnings are dated 12 November 2019 and 29 November 2019, not November 2021; the 12 November 2019 Public Notice on Cryptocurrencies cites sections 26 and 27 of the Bank of Tanzania Act, 2006, states that the Tanzanian Shilling is the only acceptable legal tender, and advises the public against trading, marketing and usage of virtual currency as contrary to existing foreign exchange regulations, while the Bank's press-release index carries no cryptocurrency item at any point in 2021 and its next virtual-asset publication is the Central Bank Digital Currency progress notice of 14 January 2023.

Example News Article (referencing BoT's stance in 2021): https://www.reuters.com/markets/currencies/tanzania-study-cryptocurrencies-president-says-2021-06-14/ (Note: This is a news report, not a direct BoT statement, but reflects their historical position).

BoT Press Release Example (CBDC Exploration): While specific press releases might be archived, the BoT's public statements often mention their ongoing research.

Capital Markets and Securities Act, 1994 (as amended):

Tanzania's securities statute is the Capital Markets and Securities Act, Chapter 79 (Act No. 5 of 1994), which establishes the Capital Markets and Securities Authority and governs dealer and investment-adviser licensing, stock exchange operation, public offerings, collective investment schemes, market manipulation and insider trading; the Act contains no reference to virtual assets, cryptocurrency, digital assets or stablecoins, and the Authority has never classified a stablecoin or any virtual asset as a security, its principal-legislation index and its press-release index carrying no crypto item of any kind.