Madagascar

**Report: Retail Cryptocurrency Trading Status in Madagascar**

**Topic:** Retail_Trading_Status

**Description:** Assessment of the legal permissibility for individual citizens and residents in Madagascar to buy, sell, and hold cryptocurrencies, including details on the regulatory environment.

**1. Identified Status:** **Banned**

**2. Narrative Explanation:**

The current status of retail cryptocurrency trading in Madagascar is **Banned**. This determination is based on official communications from the Banque Centrale de Madagascar (BCM), the country's central bank, and consistent reporting from legal and financial information sources.

While Madagascar has not enacted specific, comprehensive legislation explicitly detailing cryptocurrency prohibitions, the BCM has issued clear warnings and directives that effectively ban activities related to cryptocurrencies for the general public. In October 2021, the BCM released a communiqué addressing the emergence of cryptocurrencies. In this statement, the BCM explicitly noted that:
*   Cryptocurrencies are not issued or regulated by the BCM or any other monetary authority in Madagascar.
*   Cryptocurrencies do not have legal tender status within the country.
*   Providers offering services related to cryptocurrency investment, marketing, or exchange are not regulated under existing Malagasy law.

The BCM warned the public about significant risks associated with cryptocurrencies, including:
*   Use in illicit activities like money laundering and terrorism financing due to the potential for anonymity.
*   Financial risks stemming from high volatility and speculative nature, potentially leading to significant losses for consumers.
*   Lack of consumer protection, as unregulated exchange platforms bear no responsibility for losses.
*   Absence of legal recourse in cases of cyber-attacks, fraud, or errors.

The BCM's stance is grounded in its mandate, particularly Article 9 of the law governing its statutes, which grants it the exclusive privilege of issuing legal tender banknotes and coins in Madagascar. By stating that cryptocurrencies lack legal tender status and are unregulated, and by highlighting the severe risks without providing any framework for legal operation, the BCM effectively prohibits their legitimate use and trading by the general public.

Although some sources indicate ongoing reflections or studies within the BCM regarding virtual assets and fintech, and participation in regional discussions about potential regulation (like those within ESAAMLG), these discussions have not yet translated into any change in the prohibitive stance communicated to the public. International exchanges often list Madagascar as a country where services are restricted or unavailable due to the regulatory environment. While some peer-to-peer (P2P) trading might occur, it operates outside the established legal and financial system and carries the risks highlighted by the BCM.

Therefore, based on the central bank's official warnings and the lack of any regulatory framework permitting or overseeing cryptocurrency activities, retail trading (buying, selling, holding) is considered banned for individuals in Madagascar.

**3. Relevant Excerpts from Sources:**

*   **Banque Centrale de Madagascar (BCM) via Orange Actu Madagascar (October 5, 2021):** "Selon la Banque Centrale de Madagascar (BFM), les cryptomonnaies [...] ne sont ni émises ni règlementées par BFM ou toute autre autorité monétaire et n'ont pas cours légal à Madagascar. Aussi, les prestataires exerçant des activités d'investissement, de commercialisation ou d'échange de cryptomonnaies ne sont pas règlementés dans le cadre de la législation en vigueur [...] la Banque Centrale de Madagascar met en garde le public sur les risques associés aux cryptomonnaies [...] L'absence de statut légal et de cadre règlementaire figure également parmi les risques associés aux cryptomonnaies les plus marquants."
    *(Summary: According to the BCM, cryptocurrencies are neither issued nor regulated by the BCM or any other monetary authority and do not have legal tender status in Madagascar. Service providers related to crypto are not regulated. The BCM warns the public of the risks, highlighting the absence of legal status and regulatory framework as a major risk.)*

*   **John W Ffooks & Co (Legal Firm specializing in Francophone Africa) (April 28, 2022):** "Madagascar has still not adopted any laws or regulations on cryptocurrency. [...] The last official communiqué of the Central Bank on cryptocurrency was dated 5 October 2021. In this communiqué, the Central Bank (i) confirms that cryptocurrencies are not regulated in Madagascar, (ii) warns the public of risks associated to cryptocurrencies and (iii) recommends the public to exercise caution when involved in cryptocurrency-related activities."

*   **Proelium Law LLP (Cryptocurrency Regulation Tracker):** Lists Madagascar's status as "Undecided" but elaborates: "No legal status for cryptocurrencies; There is no cryptocurrency regulation." *(Note: While labeled "Undecided," the description aligns with an environment where activity is not legally sanctioned or regulated, effectively supporting the Banned/Prohibited practical status based on BCM warnings).*

*   **Ministère de l'Economie et des Finances, Madagascar (Reporting on ESAAMLG meeting, Sept 2022):** Mentions participation in a public-private dialogue regarding virtual assets, including the need to implement new cryptocurrency regulations in ESAAMLG member countries, suggesting a recognition of the topic but not indicating a change in Madagascar's domestic stance. It notes a consensus among members that crypto should be "regulated, not banned," but this reflects a regional discussion outcome, not current Malagasy law.

**4. Source URLs:**

*   **BCM Communiqué Summary (Orange Actu Madagascar):** [https://actu.orange.mg/emergence-de-la-cryptomonnaie-la-bfm-met-en-garde/](https://vertexaisearch.cloud.google.com/grounding-api-redirect/AWQVqAItnLj5tnaAzeNmeQ7ki3AAXi0kj9E5EmjPCOpP2NVui8OA38gdkycxPNv7_FPFVTKWmWmfghXPUVs4YY3ythWKEAqBoO8iPn6AxfoZnAKlZDbNV3eI3XomNQhD-nw3VEfK_BE713ZWrEUzuyGUZX3_DDLS4eJ1NQJB2UT-eWZZ)
*   **John W Ffooks & Co Analysis:** [https://www.jwflegal.com/news/francophone-africa-cryptocurrency-regulation/](https://vertexaisearch.cloud.google.com/grounding-api-redirect/AWQVqAKiVab5-pDttrFHJwWL8Kit3cu_yDBdKB7En1RUIFQZLNZoEgvaLw4rnTyp7Kf9hMMwUNxgLGIJLpzKgpUYVFWmKw2tAXWJpcUYHo_dMIgEqnV7Iz8t8E-FzIr3tEhXZ12WerHy2BrVHZG-T3txDB_drlHEQZD_5qpsxS2O9WAvdHqzS8jZGXSmhA==)
*   **Proelium Law LLP Tracker:** [https://www.proeliumlaw.com/cryptocurrency-regulation-tracker/](https://vertexaisearch.cloud.google.com/grounding-api-redirect/AWQVqAI_tNsO-nSggKNrWLIpuNtP2Su0fb06eM857LqwOB4nbU6mPpznVpok3ZT1iaB4GU1Tv1FpIzLavMoBwsiCYMgloGXiChCnBR4rkDoLPEGJ4jmaZrNqFlx1NqvTMj6XuA4syeaN5sbWcDnFPZUs7r42)
*   **Ministère de l'Economie et des Finances (ESAAMLG Report):** [https://www.mef.gov.mg/contenus/activites/835](https://vertexaisearch.cloud.google.com/grounding-api-redirect/AWQVqAJIEVz5bIukqLtXQWTttVsylSo0Lz0EZcZiFfXT5EzYGzARFUzMLaNdoffVEE6IZnzHOJugcYZBLmaOqUFK59Q4ZfhEmrb4X3XT7fu7bu322AHKOjmUQQCyfxS0Mb3x14iLR2G2yZkn40c2vNDpLxc=)
*   **Association of African Central Banks (AACB) Report (mentioning BCM reflections):** [https://www.aacb.org/sites/default/files/2022-07/AACB%20Annual%20Report%202021%20-%20English.pdf](https://vertexaisearch.cloud.google.com/grounding-api-redirect/AWQVqAIuAFX52YjEHB11FI4FnDIWrAXfRUjNQgS0Rmj-lWv8S8gxnpjr0w19Cj3GXe9t1ZBG_6l-wJQit0vUICoK07M3ymbgrizsp-T_O-fhhPUZggJTqqEsuVMhqJsv7hOLf5SXtfW8nOSG8V0qGWAyFNBxGILiRMeiLSqPfnnqfsLg7hxNi1VUuS_OZXdbyB9XAZkxQvrwtGvBh4jyCruriwf_envF) (Page 79 references "Reflections on these topics are ongoing within BFM" regarding Fintech/Sandbox)