Sint Maarten (Dutch part)

**Report: Retail Cryptocurrency Trading Status in Sint Maarten (Dutch Part)**

**Date:** April 12, 2025

**Report Author:** Specialized Financial Regulatory Analyst

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**Topic: Retail_Trading_Status**

**Description:** Assessment of the legal permissibility for individual citizens and residents in Sint Maarten (Dutch part) to buy, sell, and hold cryptocurrencies, including the regulatory environment surrounding this activity (e.g., KYC/AML requirements, official warnings).

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**1. Current Status:** `Unclear`

**2. Detailed Narrative Explanation:**

The status of retail cryptocurrency trading in Sint Maarten (Dutch part) is best described as "Unclear" due to an evolving regulatory landscape. While there is no explicit ban preventing individuals from buying, selling, or holding cryptocurrencies, and such activities do occur, a specific, comprehensive regulatory framework governing these assets and the service providers (Virtual Asset Service Providers - VASPs) is currently under development and not yet fully implemented.

*   **Permitted Activity but Lack of Specific Regulation:** Individuals in Sint Maarten are generally able to engage with cryptocurrencies. Evidence suggests that crypto assets are used for investment and, to some extent, as a means of payment within the territory. However, unlike traditional financial instruments, cryptocurrencies and the platforms facilitating their trade have not historically been subject to a dedicated regulatory regime specific to their unique characteristics within Sint Maarten.
*   **Regulatory Framework in Development:** The Centrale Bank van Curaçao en Sint Maarten (CBCS), the central bank for the monetary union, is actively working with the governments of Curaçao and Sint Maarten to establish formal oversight. A key piece of legislation, the National Ordinance for the supervision of virtual assets service providers (NOSVASP), is currently in the legislative process. Once enacted, this ordinance will mandate that VASPs operating in or from Sint Maarten obtain a license, dispensation, or exemption from the CBCS. This framework aims to address risks and align with international standards, such as those set by the Financial Action Task Force (FATF).
*   **Existing AML/CFT Obligations:** While VASP-specific regulations are pending, existing financial laws, particularly those related to Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) and customer identification (Know Your Customer - KYC), are applicable. The National Ordinance on Identification when Rendering Services (NOIS), for instance, imposes obligations that entities involved in financial services, potentially including those handling crypto transactions, must follow. Fintech companies, including those in the crypto space, are expected to adhere to these AML/CFT requirements.
*   **Central Bank Warnings:** The CBCS has publicly acknowledged the growing interest in crypto assets but has also issued warnings, particularly directed at retail investors. These warnings highlight the significant risks associated with cryptocurrencies, including high volatility, the general lack of regulation and consumer protection for providers/exchanges, cybersecurity vulnerabilities, and the potential for misuse in illicit activities. The CBCS has explicitly stated that such high-risk investments are often unsuitable for non-professional investors.
*   **Taxation:** From a taxation perspective for private individuals, the situation in Sint Maarten has been described as favorable, with capital gains on cryptocurrencies held personally potentially remaining untaxed under current interpretations of tax law, as they may not be seen as generating "split-off" income. However, this could change with evolving regulations or interpretations.
*   **Legal Tender Status:** Cryptocurrencies are not recognized as legal tender in Sint Maarten. A legislative proposal by a member of parliament in early 2023 to adopt Tron (TRX) as legal tender did not advance into law.

The "Unclear" status reflects this transitional phase. Trading is happening under the umbrella of general financial laws (especially AML/CFT), but the specific rules, licensing requirements, and supervisory practices for the crypto sector are still being finalized and implemented through the NOSVASP. This creates ambiguity regarding the precise regulatory obligations and protections currently in effect for both retail users and service providers.

**3. Relevant Text Excerpts:**

*   **On Regulation Development (CBCS, May 2024):** "As crypto is still relatively new in financial markets worldwide, and innovating rapidly, regulation has yet to be established in most areas in the world. Curaçao and Sint Maarten are in the process of finalizing a comprehensive regulatory framework for virtual assets service providers (VASPs). The new comprehensive regulatory framework for VASPs will comprise of a National Ordinance for the supervision of virtual assets service providers (NOSVASP) and related regulations. The NOSVASP is currently in legislative process... VASPs will have to obtain a license, dispensation, or exemption from the CBCS to operate in or from Curaçao and/or Sint Maarten."
    *   *Source:* The Rise of Financial Technology in Curaçao and Sint Maarten An Exploratory Analysis, Centrale Bank van Curaçao en Sint Maarten (CBCS)
*   **On AML/CFT Applicability (CBCS, May 2024):** "In support of these legislations [AML/CFT laws], the CBCS has also published provisions and guidelines for combatting money laundering and terrorist financing. Fintech companies, based on the nature of their activities, must adhere to the AML/CFT legislation."
    *   *Source:* The Rise of Financial Technology in Curaçao and Sint Maarten An Exploratory Analysis, Centrale Bank van Curaçao en Sint Maarten (CBCS)
*   **On Central Bank Warnings (CBCS, 2019):** "High volatility, the lack of (proper) regulation, vulnerabilities concerning cybersecurity, misuse for criminal and fraudulent activities, and lack of transparency makes these types of high risk investments unsuitable for retail investors, or investors other than professional, accredited, or sophisticated investors... In many instances today, cryptocurrency exchanges are still unregulated. As a result, investors do not have the same protections as they would on regulated securities exchanges."
    *   *Source:* Caribbean Fintech Pledge, Centrale Bank van Curaçao en Sint Maarten (CBCS)
*   **On Taxation (Caribbean Tax Law Journal):** "In Sint Maarten, cryptocurrencies held by private individuals are actually completely untaxed. As noted earlier, cryptocurrency does not yield revenue that splits-off, but only changes in value... In contrast to Europe, there is no legislation in Sint Maarten yet regulating that digital platforms are obliged to provide taxation-relevant information about their users to the tax authorities..."
    *   *Source:* CRYPTOCURRENCY IN ST MAARTEN - Caribbean Tax Law Journal (via Google Search Snippet)
*   **On Risks (BIS Speech Summary, CBCS Representative):** "Institutions that wish to engage in such transactions should be vigilant of the risks involved... Cryptocurrencies are highly volatile, intangible, exist on non-regulated markets, and are uninsured by any authority. Another concern is the use of crypto assets for criminal and/or illegitimate purposes."
    *   *Source:* Introducing the new CBCS Corporate Governance Code in uncertain times - Bank for International Settlements (BIS)

**4. Source URLs:**

*   **CBCS Fintech Report (May 2024):** `https://www.centralbank.cw/publications/reports/other-reports/the-rise-of-financial-technology-in-curacao-and-sint-maarten` (Note: Direct PDF link might be available on the CBCS publications page if this overview page changes)
*   **CBCS Caribbean Fintech Pledge:** `https://www.centralbank.cw/education/investor-education/caribbean-fintech-pledge`
*   **BIS Speech Summary (CBCS Representative):** `https://www.bis.org/review/r220217f.pdf`
*   **Caribbean Tax Law Journal (via Google Search Snippet - Full access may require subscription):** No direct stable URL available from search results, source identified as "Caribbean Tax Law Journal". Primary access would require finding the journal's archive or database access.
*   **CBCS Main Website (for Legislation & Guidelines):** `https://www.centralbank.cw/`

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**End of Report**