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Algeria

Retail_Trading_Status

Banned Unknown
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Analysis ID
#31
Version
Archived
Created
2025-04-12 06:39
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Live

Executive Summary

Retail cryptocurrency trading is banned in Algeria under Article 117 of the Finance Law for 2018. The ban is enforced by the Bank of Algeria due to concerns about financial stability, illicit activities, and lack of central control. No licensed cryptocurrency exchanges operate legally in Algeria, and while P2P trading persists, it remains illegal. There is no specific tax framework for cryptocurrencies as they are illegal.

Key Pillars

The primary regulator is the Bank of Algeria (Banque d'Algérie). The key compliance requirements include adherence to the Finance Law for 2018, Article 117, which prohibits the purchase, sale, use, and possession of virtual currencies. There are no licensing or registration requirements for cryptocurrency exchanges, as such activities are illegal.

Landmark Laws

Finance Law for 2018 (Loi n° 17-11 du 27 décembre 2017), Article 117: Issued on December 27, 2017. This article prohibits the purchase, sale, use, and possession of virtual currency.

Considerations

Cryptocurrencies are classified as "virtual currency" under Algerian law. There is no specific tax framework because cryptocurrencies are illegal. Regulators are concerned about financial instability, illicit activities, lack of central control, and consumer protection.

Notes

The ban on cryptocurrency trading was implemented due to concerns about financial stability, illicit activities, and lack of central control. Despite the ban, some peer-to-peer (P2P) trading and use of foreign platforms may persist. Algeria might explore a central bank digital currency (CBDC) in the future, but this would be distinct from decentralized cryptocurrencies. Official sources might not have prominent crypto statements, requiring review of broader banking regulations.

Detailed Explanation

In Algeria, retail trading of cryptocurrencies is explicitly banned. This prohibition is primarily based on Article 117 of the Finance Law for 2018 (Loi n° 17-11 du 27 décembre 2017), which forbids Algerian citizens and residents from engaging with "virtual currency." The law broadly defines virtual currency as any currency used by internet users lacking physical support such as coins, banknotes, or payments via checks or bank cards. The Algerian government implemented this ban due to concerns about financial stability, potential illicit activities (money laundering, terrorism financing), the lack of central control over cryptocurrencies operating outside the traditional banking system, and consumer protection (fraud and loss vulnerabilities due to the absence of regulatory oversight). As a consequence, no licensed or regulated cryptocurrency exchanges operate legally in Algeria. While some peer-to-peer (P2P) trading or the use of foreign platforms might persist, these activities remain illegal, and individuals engaging in such transactions may face penalties. There is currently no specific tax framework for cryptocurrencies in Algeria due to their illegal status. The Bank of Algeria (Banque d'Algérie) upholds the government's restrictive stance, and has not indicated any plans to regulate or permit cryptocurrency activities. However, Algeria might explore a central bank digital currency (CBDC) in the future, distinct from decentralized cryptocurrencies. The Algerian Dinar (DZD) is subject to strict exchange controls.

Summary Points

Here's a bullet-point summary of the provided report, designed for clarity and quick comprehension:

Retail Cryptocurrency Trading Status in Algeria (April 12, 2025)

I. Regulatory Status:

  • Banned: Retail trading of cryptocurrencies (buying, selling, holding) is explicitly prohibited in Algeria.

II. Key Regulatory Bodies:

  • Bank of Algeria (Banque d'Algérie):
    • The central bank upholds the government's restrictive stance on cryptocurrencies.
    • Responsible for overall banking regulations and monetary policy.
  • Legislative Branch (Parliament):
    • Enacted the Finance Law for 2018, which includes the ban on cryptocurrencies.

III. Important Legislation and Regulations:

  • Finance Law for 2018 (Loi n° 17-11 du 27 décembre 2017):
    • Article 117: Explicitly prohibits the purchase, sale, use, and possession of "virtual currency."
    • Defines "virtual currency" broadly as any digital currency lacking physical support (coins, banknotes, checks, credit cards).

IV. Requirements for Compliance:

  • No Legal Compliance Framework: Since cryptocurrency trading is illegal, there is no legal framework for compliance.

V. Notable Restrictions and Limitations:

  • Complete Ban: All use of private cryptocurrencies is prohibited.
  • No Licensed Exchanges: No legally operating cryptocurrency exchanges are permitted within Algeria.
  • Restrictions on Financial Institutions: No person or bank can deal in cryptocurrencies.
  • Penalties for Violations: Individuals engaging in cryptocurrency transactions face potential penalties under existing financial regulations.

VI. Reasons for the Ban:

  • Financial Stability: Concerns about the volatility of cryptocurrencies impacting the national economy.
  • Illicit Activities: Fears that cryptocurrencies could facilitate money laundering, terrorism financing, and other illegal activities.
  • Lack of Central Control: Cryptocurrencies operate outside the state's control over capital flows and monetary sovereignty.
  • Consumer Protection: Absence of regulatory oversight and physical backing, leaving users vulnerable to fraud and loss.

VII. Recent Developments and Changes:

  • No Change in Status: The ban implemented in 2018 remains in effect as of April 2025.
  • No Tax Framework: There is no specific tax framework for cryptocurrencies due to their illegal status.
  • Potential CBDC Exploration: Algeria might explore a central bank digital currency (CBDC) in the future, but this would be distinct from decentralized cryptocurrencies.

Full Analysis Report

Report on the Current Status of Retail Cryptocurrency Trading in Algeria

Date: April 12, 2025

Topic: Retail_Trading_Status

Description: This section assesses whether individual citizens and residents in Algeria are legally permitted to buy, sell, and hold cryptocurrencies. It details the regulatory environment surrounding this activity, including applicable laws and official positions.

1. Current Status: Banned

2. Detailed Narrative Explanation:

Retail trading, including the purchase, sale, use, and possession of cryptocurrencies by individuals, is explicitly prohibited in Algeria. This ban stems primarily from the Finance Law for 2018 (Loi n° 17-11 du 27 décembre 2017 portant loi de finances pour 2018), specifically Article 117.

This article formally forbids Algerian citizens and residents from engaging with what the law terms "virtual currency" (monnaie virtuelle). The law defines this term broadly as a currency used by internet users that lacks physical support like coins, banknotes, or payment methods involving checks or bank cards. This definition effectively encompasses all cryptocurrencies, such as Bitcoin, Ethereum, and others.

The Algerian government implemented this ban due to several concerns prevalent at the time and often reiterated since:
* Financial Stability: High volatility associated with cryptocurrencies was seen as a risk to the national economy and individual investors.
* Illicit Activities: Concerns that the anonymity or pseudonymity offered by cryptocurrencies could facilitate money laundering, terrorism financing, and other illegal activities.
* Lack of Central Control: Cryptocurrencies operate outside the traditional, centrally controlled banking system, challenging the state's monetary sovereignty and control over capital flows. The Algerian Dinar (DZD) is subject to strict exchange controls.
* Consumer Protection: The absence of regulatory oversight and physical backing was perceived as leaving users vulnerable to fraud and loss without legal recourse.

As a result of this ban, there are no licensed or regulated cryptocurrency exchanges operating legally within Algeria. While the decentralized nature of cryptocurrencies makes complete enforcement difficult, and some peer-to-peer (P2P) trading or use of foreign platforms may persist underground, these activities remain illegal under Algerian law. Individuals engaging in such transactions face potential penalties according to existing financial regulations.

There is currently no specific tax framework for cryptocurrencies in Algeria, as they are illegal. However, should the legal status change, tax obligations might arise. The Bank of Algeria (Banque d'Algérie), the country's central bank, upholds the government's restrictive stance and has not indicated any imminent plans to regulate or permit cryptocurrency activities. Some sources note Algeria might explore a central bank digital currency (CBDC) in the future, but this would be distinct from decentralized cryptocurrencies.

3. Specific Relevant Text Excerpts:

  • Source: Algeria's Finance Law for 2018 (Loi n° 17-11 du 27 décembre 2017) - Article 117

    • Summary/Quote: "The purchase, sale, use, and possession of so-called virtual currency are prohibited. A virtual currency is one used by Internet users over the Internet. It is characterized by the absence of physical support such as coins, paper money, or payments by check or credit card. Any violation of this provision is punishable in accordance with the laws and regulations in force." (Summarized and quoted from various sources referencing the law, e.g., Freeman Law, Library of Congress, Binance Square).

  • Source: Library of Congress - Regulation of Cryptocurrency Around the World (November 2021 Update)

    • Quote: "All use of private cryptocurrencies is prohibited. No person or bank can deal in cryptocurrencies."

  • Source: Binance Square (September 7, 2024)

    • Quote: "Algeria is one of the countries that has a strict stance towards cryptocurrencies. The Finance Law of 2018 explicitly banned dealing in cryptocurrencies, with Article 117 stating that 'the purchase, sale, use, or possession of virtual currencies is prohibited.' This law reflects the Algerian authorities' concerns about the potential negative impact of these currencies on the local economy and financial security."

  • Source: Bitcoin.com (Review dated 2025)

    • Quote: "Cryptocurrency regulations in Algeria are restrictive, with the government officially banning the use of cryptocurrencies in 2018... Cryptocurrencies are banned for use in transactions. Violations may result in fines or penalties." And "Is it legal to trade crypto in Algeria? No, it is illegal to trade or use cryptocurrencies in Algeria."

4. Direct URL Links:

  • Algerian Official Gazette (Journal Officiel) containing the 2018 Finance Law (Arabic):

    • https://www.joradp.dz/FTP/JO-ARABE/2017/A2017076.pdf (Referenced in multiple sources, contains Article 117 on page 54)

  • Library of Congress - Regulation of Cryptocurrency Around the World (November 2021 Update):

    • https://www.loc.gov/law/help/cryptocurrency/regulation-of-cryptocurrency.pdf (Provides a summary of the legal status including the ban via Article 117) - Note: While dated 2021, the core legal basis (2018 law) remains unchanged according to recent sources.

  • Freeman Law - Algeria Cryptocurrency Regulations:

    • https://freemanlaw.com/blockchain/algeria-cryptocurrency-laws/ (Summarizes the ban under the 2018 Financial Law)

  • Binance Square - Cryptocurrencies in Algeria: Between Ban and Digital Future (Arabic & English versions):

    • Arabic: https://www.binance.com/ar/square/post/1351910
    • English: https://www.binance.com/en/square/post/1351974 (Discusses the 2018 law and reasons for the ban)

  • Bitcoin.com - Best Crypto Exchanges in Algeria for 2025:

    • https://bitcoin.com/best-crypto-exchanges/algeria (Explicitly states the ban and its implications)

  • Bank of Algeria (Banque d'Algérie) Official Website:

    • https://www.bank-of-algeria.dz/ (While no specific crypto statement might be prominent, it's the primary source for official banking regulations and monetary policy)

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