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San Marino

Retail_Trading_Status

Allowed-Regulated Unknown
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Analysis ID
#292
Version
Archived
Created
2025-06-26 09:15
Workflow Stage
Initial Research

Executive Summary

Retail cryptocurrency trading is permitted in San Marino but regulated, with the Central Bank of the Republic of San Marino (CBSM) overseeing crypto-assets (type A tokens) and the Institute for Innovation handling other types (type B tokens). Key regulations include Delegated Decree No. 37 of 2019 and Delegated Decree No. 2 of January 2024, which addresses the issuance, offering, and trading of tokens. San Marino aligns its regulations with European standards like MiCA and imposes AML/KYC requirements. Individuals face an 8% substitute tax on crypto-asset gains, with a €2,000 annual exemption.

Key Pillars

The primary regulator is the Central Bank of the Republic of San Marino (CBSM) for type A tokens, and the Institute for Innovation for type B tokens. Key regulatory pillars include adherence to AML/KYC standards for exchanges and wallet services, and the requirement for DLT operators to obtain authorization from the CBSM. San Marino also has specific tax rules for crypto-assets.

Landmark Laws

  • Delegated Decree No. 37 of 2019: Addressed the issuance, offering, and trading of various types of tokens.
  • Delegated Decree No. 2 of January 2024 ("Regulation of Technologies Based on Distributed Ledgers"): This decree regulates Distributed Ledger Technologies (DLTs) and provides a safe but also scalable space for blockchain businesses.
  • San Marino Decree No. 138 of August 29, 2024 (Potentially a typo, with other sources pointing to Delegated Decree No. 2 of January 2024): A comprehensive regulatory framework designed to govern the issuance, offering, trading, and provision of services related to tokens, including cryptocurrencies.

Considerations

Cryptocurrencies are regarded as assets rather than official currency. San Marino imposes an 8% substitute tax on crypto-asset gains for individuals, with a €2,000 annual exemption. Utility tokens are treated similarly to foreign currencies for tax and accounting purposes. Regulators emphasize the importance of adhering to anti-money laundering (AML) and know-your-customer (KYC) standards for crypto exchanges and wallet services.

Notes

In 2019, the CBSM issued a precautionary statement advising due diligence, noting that virtual currencies were not subject to specific financial regulation or Central Bank authorization at that time; the regulatory landscape has significantly evolved since then. San Marino is aligning its regulatory framework with European standards, particularly the Markets in Crypto-Assets Regulation (MiCA), even though it is not an EU member. San Marino Innovation, a state-owned entity, plays a significant role in guiding DLT operators and promoting the development of digital ecosystems. Some sources mention 'San Marino Decree No. 138 of August 29, 2024,' but other sources point to 'Delegated Decree No. 2 of January 2024' as the key recent legislation; this may be a typo or refer to a complementary decree.

Detailed Explanation

San Marino permits retail cryptocurrency trading but regulates it through a growing body of laws. Delegated Decree No. 37 of 2019 and Delegated Decree No. 2 of January 2024 ("Regulation of Technologies Based on Distributed Ledgers") form the basis of this regulation, covering the issuance, offering, and trading of tokens. The Central Bank of the Republic of San Marino (CBSM) supervises crypto-assets (type A tokens), while the Institute for Innovation is responsible for other types of tokens (type B tokens). Operators dealing with crypto-assets, including exchanges, require authorization from the CBSM. Foreign DLT operators offering crypto-asset services in San Marino are also subject to CBSM supervision.

In 2019, the CBSM issued a precautionary statement advising due diligence, emphasizing that virtual currencies were not subject to specific financial regulation or Central Bank authorization at that time. The regulatory landscape has evolved significantly since then, aligning with European standards, including MiCA, to ensure cross-border compatibility and investor confidence. AML/KYC requirements are central, demanding that entities involved in crypto-asset activities comply with San Marino's AML regulations for secure digital asset transactions. Exchanges and wallet services must adhere to these standards.

San Marino has introduced specific tax rules for crypto-assets. For individuals, gains from the onerous transfer or realization of crypto-assets are subject to an 8% substitute tax, with an annual exemption for capital gains up to €2,000. Utility tokens are treated similarly to foreign currencies for tax and accounting purposes. The government actively supports blockchain and crypto projects, with San Marino Innovation playing a significant role in guiding DLT operators and promoting the development of digital ecosystems.

According to the UPay Blog (2024-12-11), cryptocurrency is legal in San Marino, and the country is actively preparing to become a global blockchain and cryptocurrency center through legal measures, tax benefits, and advanced projects. The Central Bank of the Republic of San Marino (CBSM) has conducted public consultations to devise a framework for regulating crypto assets, considering the European Institutions' Markets in Crypto-Assets Regulation (MiCAR). Toccaceli Bronzetti notes that the Central Bank is the competent supervisory authority for crypto-assets or type A tokens, and DLT operators providing services in crypto-assets are subject to Central Bank supervision. Transparency and anti-money laundering measures are prioritized for system protection.

Affidaty S.p.A. (2024-06-05) highlights that individuals face an 8% substitute tax on the onerous transfer or realization of crypto-assets, with a €2,000 annual exemption from capital gains income. PlasBit (2024-03-04) notes that cryptocurrencies are regarded as assets and that regulations require adherence to AML and KYC standards for crypto exchanges and wallet services. Gatti, Stefania Maria (Dott.ssa), references 'San Marino Decree No. 138 of August 29, 2024' as a comprehensive regulatory framework. However, other sources refer to 'Delegated Decree No. 2 of January 2024' as the key recent legislation. Operators involved in token-related activities must be licensed and registered with the appropriate authority (Banca Centrale or Istituto per l'Innovazione).

Summary Points

Retail Trading of Crypto-Assets in San Marino: Regulatory Overview (2025)

Overall Status: Allowed-Regulated

I. Key Regulatory Bodies & Roles:

  • Central Bank of the Republic of San Marino (CBSM):
    • Competent supervisory authority for crypto-assets (Type A tokens).
    • Supervises DLT operators providing crypto-asset services, including issuance, offering, and trading.
    • Responsible for authorization of crypto-asset operators, including foreign DLT operators.
  • Institute for Innovation:
    • Responsible for other types of tokens (Type B tokens).
  • San Marino Innovation (State-Owned Entity):
    • Guides DLT operators.
    • Promotes the development of digital ecosystems.

II. Key Legislation & Regulations:

  • Delegated Decree No. 37 of 2019: Initial groundwork for regulating blockchain and crypto activities.
  • Delegated Decree No. 2 of January 2024 ("Regulation of Technologies Based on Distributed Ledgers"):
    • Regulates Distributed Ledger Technologies (DLTs).
    • Addresses the issuance, offering, and trading of various types of tokens.
  • Alignment with EU MiCA: Framework aims to align with European standards, particularly the Markets in Crypto-Assets Regulation (MiCA) from the European Union.

III. Requirements for Compliance:

  • AML/KYC Compliance:
    • Entities involved in crypto-asset activities must comply with San Marino's AML regulations.
    • Exchanges and wallet services are required to adhere to KYC standards.
  • Licensing and Registration:
    • Operators involved in token-related activities must be licensed and registered with the appropriate authority (CBSM or Institute for Innovation).

IV. Taxation of Crypto-Assets:

  • Individual Gains:
    • Gains from the onerous transfer or realization of crypto-assets are subject to a substitute tax at an 8% rate.
    • Annual exemption for capital gains from crypto-assets up to €2,000.
  • Utility Tokens:
    • Treated similarly to foreign currencies for tax and accounting purposes.

V. Notable Restrictions or Limitations:

  • While retail trading is permitted, it is subject to the regulations outlined above.
  • Operators must be authorized and supervised by the CBSM.

VI. Recent Developments or Changes:

  • Shift from Unregulated to Regulated: The regulatory landscape has evolved significantly since 2019.
  • Focus on Transparency and Innovation: San Marino is actively building a comprehensive regulatory system to attract investment and foster innovation in the blockchain sector.
  • Decree No. 2 of January 2024: The most notable advancement is Delegated Decree No. 2nd of January 2024, which regulates Distributed Ledger Technologies (DLTs).

Full Analysis Report

Report on Retail_Trading_Status in San Marino

Date: 2025-06-26

Topic: Retail_Trading_Status

Description: Assess whether individual citizens and residents in the country are legally permitted to buy, sell, and hold cryptocurrencies. Detail the regulatory environment surrounding this activity (e.g., KYC/AML requirements imposed on platforms, general warnings issued).

Retail_Trading_Status

Identified Status: Allowed-Regulated

Detailed Narrative Explanation:

San Marino has actively positioned itself as a jurisdiction open to blockchain technology and cryptocurrencies, establishing a specific legal and regulatory framework to govern these activities. Retail cryptocurrency trading by individual citizens and residents is permitted but is subject to a growing body of regulations, including those related to Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements, as well as specific tax rules for crypto-assets.

The country's approach has been to create a transparent and clear regulatory environment to attract investment and foster innovation in the blockchain sector. Key legislative acts, including Delegated Decree No. 37 of 2019 and more recently, Delegated Decree No. 2 of January 2024 ("Regulation of Technologies Based on Distributed Ledgers"), have laid the groundwork for this. These decrees address the issuance, offering, and trading of various types of tokens.

The Central Bank of the Republic of San Marino (CBSM) is the competent supervisory authority for crypto-assets (referred to as type A tokens). The Institute for Innovation is responsible for other types of tokens (type B tokens). Operators dealing with crypto-assets, including exchanges, are subject to CBSM supervision and must obtain authorization. This includes foreign DLT (Distributed Ledger Technology) operators wishing to offer crypto-asset services in San Marino.

While initially, in 2019, the CBSM issued a precautionary statement advising due diligence and highlighting that virtual currencies were not subject to specific financial regulation or Central Bank authorization at that time, the regulatory landscape has since evolved significantly. The current framework aims to align with European standards, particularly the Markets in Crypto-Assets Regulation (MiCA) from the European Union, even though San Marino is not an EU member. This strategic alignment is intended to ensure cross-border compatibility and investor confidence.

AML/KYC requirements are a key component of the regulatory framework. Entities involved in crypto-asset activities must comply with San Marino's AML regulations to ensure a safe and reliable environment for digital asset transactions. Exchanges and wallet services are required to adhere to these standards.

From a taxation perspective, San Marino has introduced specific rules for crypto-assets. For individuals, gains from the onerous transfer or realization of crypto-assets are subject to a substitute tax at an 8% rate. There is also an annual exemption for capital gains from crypto-assets up to €2,000. Utility tokens are treated similarly to foreign currencies for tax and accounting purposes.

The government has actively supported blockchain and crypto projects, indicating a commitment to integrating these technologies. San Marino Innovation, a state-owned entity, plays a significant role in guiding DLT operators and promoting the development of digital ecosystems.

While some earlier sources from 2019 or those with less specific information might have suggested an unregulated or unclear status, the more recent legislative developments and official stances clearly point towards an "Allowed-Regulated" environment. The country is not only permitting retail crypto trading but is actively building a comprehensive regulatory system around it.

Specific, Relevant Text Excerpts:

  • UPay Blog (2024-12-11): "Adoption Status: Cryptocurrency is legal in San Marino. The country is actively making preparations to become a global blockchain and cryptocurrency center by enacting legal measures and tax benefits and executing advanced projects."
  • UPay Blog (2024-12-11): "The most notable advancement is Delegated Decree No. 2nd of January 2024, which regulates Distributed Ledger Technologies (DLTs). This decree is one step in a broader plan to provide a safe but also scalable space for blockchain businesses."
  • UPay Blog (2024-12-11): "Moreover, the Central Bank of the Republic of San Marino (CBSM) has already made a public consultation to devise a framework for the regulation of crypto assets that is likely to take into account the European Institutions' Markets in Crypto-Assets Regulation (MiCAR)."
  • UPay Blog (2024-12-11): "For individuals, the country imposes an 8% substitute tax on crypto-asset gains, with a €2,000 annual exemption, which lowers the entry barrier for smaller investors."
  • Toccaceli Bronzetti (discussing "REGULATION OF TECHNOLOGIES BASED ON DISTRIBUTED LOGISTERS IN SAN MARINO"): "The Central Bank is the competent supervisory authority for crypto-assets or type A tokens... DLT operators who also provide services in crypto-assets, as well as the issuance, offering or admission to trading of crypto-assets, are subject to the supervision of the Central Bank."
  • Toccaceli Bronzetti: "Transparency: anti-money laundering measures for maximum protection of the system."
  • Affidaty S.p.A. (2024-06-05): "Regarding individuals, the onerous transfer or realization of crypto-assets is taxed by a substitute tax with an 8% rate. An exemption from capital gains income deriving from crypto-assets up to a limit of 2,000.00 euros per year has also been provided."
  • PlasBit (2024-03-04): "Notably cryptocurrencies are regarded as assets than official currency with regulations requiring adherence to anti-money laundering (AML) and know-your-customer (KYC) standards for crypto exchanges and wallet services."
  • Gatti, Stefania Maria (Dott.ssa) (referencing San Marino Decree No. 138 of August 29, 2024 - Note: While the year 2024 is mentioned, other sources point to Delegated Decree No. 2 of January 2024 as the key recent legislation. This might be a typo in the source or refer to a complementary decree. The overall regulatory direction is consistent.): "The San Marino Decree No. 138 of August 29, 2024, is a comprehensive regulatory framework designed to govern the issuance, offering, trading, and provision of services related to tokens, including cryptocurrencies, within the Republic of San Marino."
  • Gatti, Stefania Maria (Dott.ssa): "Operators involved in token-related activities must be licensed and registered with the appropriate authority (Banca Centrale or Istituto per l'Innovazione)."

Direct, Accessible URL Links to Specific Sources:

Web Sources (9)

Sources discovered via web search grounding

Search queries used (6)
  • San Marino cryptocurrency regulation retail trading
  • San Marino crypto laws for individuals
  • Central Bank of San Marino cryptocurrency policy
  • San Marino financial regulator cryptocurrency
  • Legal status of Bitcoin in San Marino
  • San Marino AML/KYC cryptocurrency exchanges
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