Back to Analyses

Costa Rica

Retail_Trading_Status

Allowed-Unregulated Unknown
Edit

Status Changed

Previous status: Allowed-UnRegulated

Okay, as a specialized financial regulatory analyst, here's a detailed breakdown of the changes that occurred in the analysis result for **Retail_Trading_Status** in **Costa Rica** between your previous analysis (April 12, 2025) and the new analysis (June 26, 2025). **Overall Summary of Changes:** The fundamental assessment of Costa Rica's retail cryptocurrency trading status remains **`Allowed-Unregulated`** in both reports. However, the new analysis (June 26, 2025) incorporates more recent source information, introduces a significant new risk factor (U.S. INCSR report on money laundering), and omits a previously highlighted positive development (Banco Nacional Bitcoin ETF). While the core regulatory stance hasn't changed, the nuances and supporting evidence have evolved, leading to a slightly more cautionary tone in the newer report. **Detailed Changes in Analysis Result:** 1. **Current Status:** * **Previous Analysis (April 12, 2025):** `Allowed-UnRegulated` * **New Analysis (June 26, 2025):** `Allowed-Unregulated` * **Change:** No change in the overall status classification. Minor formatting difference (hyphen). 2. **Detailed Narrative Explanation - Key Differences:** * **Emphasis on Lack of Specific Licensing:** * **Previous:** Mentioned "no specific, comprehensive legal framework" and no "crypto license." * **New:** More explicitly states "no crypto-specific licenses are issued for exchanges, and there are no explicit crypto-focused regulations governing these activities for retail traders." * **Change:** The new analysis is slightly more direct in highlighting the absence of specific licensing mechanisms for crypto entities. * **Central Bank (BCCR) Stance:** * **Previous:** Referenced BCCR clarifications on "several occasions," citing sources [4, 9, 13]. * **New:** Specifically mentions BCCR statements in "2017 and again in 2018." * **Change:** The new analysis provides more specific dating for the BCCR's key pronouncements, though the substance of the stance (not legal tender, at own risk) remains consistent. * **Proposed Legislation (Crypto Asset Market Law):** * **Previous:** Mentioned the "Crypto Asset Market Law" proposed around 2022, noting it "appears to have stalled" as of early 2025, citing [6, 7]. * **New:** Refers to the proposed "Crypto Assets Market Law" (MECA) and notes that "as of mid-2025, no comprehensive, crypto-specific regulatory framework has been officially implemented." It also cites a new source (Quatro Legal) specifically discussing Bill 23.415 (which is MECA). * **Change:** The new analysis uses the acronym "MECA," provides a more current status update (mid-2025), and introduces a new, specific source regarding the bill. The conclusion about its stalled/unimplemented status is consistent. * **Introduction of New Risk Factor (INCSR Report):** * **Previous:** Did not mention the U.S. Department of State's INCSR report. * **New:** Includes a significant new piece of information: "The U.S. Department of State's 2025 International Narcotics Control Strategy Report (INCSR) highlighted that virtual currencies are a rising threat for money laundering in Costa Rica due to their unregulated nature." This is supported by a new source (The Tico Times, June 2025). * **Change:** This is a major addition. It introduces an external, official assessment highlighting significant money laundering risks associated with the unregulated crypto environment in Costa Rica. This adds a more critical and cautionary dimension to the analysis. * **Omission of Banco Nacional Bitcoin ETF:** * **Previous:** Highlighted as a "notable development in early 2025" the launch of a spot Bitcoin ETF by Banco Nacional, signaling "growing institutional acceptance," citing [6]. * **New:** This development is *not mentioned* in the narrative of the new analysis. * **Change:** This is a significant omission. The removal of this previously highlighted positive development changes the overall balance of recent developments discussed. The reason for omission isn't stated (e.g., if the ETF launch stalled or was deemed less relevant later), but its absence is a key difference. * **Emphasis on Adoption:** * **Previous:** Mentioned use in real estate and discussions about salary payments. * **New:** States "There is an increasing adoption of cryptocurrencies in Costa Rica, particularly in sectors like tourism and real estate. Some businesses even offer to pay a portion of salaries in cryptocurrency." * **Change:** The new report frames adoption as "increasing" and specifically adds "tourism" as a sector, suggesting a broader or more visible uptake. 3. **Relevant Text Excerpts & Sourcing:** * **Recency of Sources:** * **Previous:** Sources generally dated up to early 2025 or were undated but accessed prior. * **New:** Incorporates several sources with May and June 2025 dates (e.g., LegalBison 2025-05-05, CoinStats 2025-06-24, Coinfomania 2025-06-24, The Tico Times 2025-06-04, Kryptomoney 2025-04-09). * **Change:** The new analysis is based on more current information, reflecting developments and commentary closer to its publication date. * **Specific New Excerpts/Sources:** * **Previous:** Key excerpts from Regulated United Europe, Blue Water Properties, Wikipedia, Kryptomoney, Finance Magnates, LegalBison. * **New:** Introduces new key excerpts and sources from: * **LegalBison (updated):** More recent access date. * **CoinStats, Coinfomania, UPay Blog, AInvest:** These are new sources providing perspectives on the regulatory environment and adoption. * **The Tico Times:** Crucially, this source provides the information about the INCSR report. * **Quatro Legal:** Specifically cited for information on Bill 23.415 (MECA). * **Change:** The evidentiary basis for the new analysis has been updated and expanded with more recent articles and different commentators, leading to the inclusion of new information like the INCSR warning. * **Source Overlap and Omissions:** * Some sources are common (Wikipedia, Kryptomoney, LegalBison, Regulated United Europe). * Sources like Finance Magnates (which reported the ETF) and Blue Water Properties are prominent in the previous analysis's excerpts but not in the new one. * **Change:** The shift in sources directly contributes to the differences in highlighted information (e.g., ETF news vs. INCSR warning). 4. **Tone and Nuance:** * **Previous:** While acknowledging risks and lack of regulation, the inclusion of the Bitcoin ETF news provided a somewhat more balanced, or even slightly optimistic, view on potential future integration with traditional finance. * **New:** The omission of the ETF news and the prominent inclusion of the INCSR money laundering warning lend a more cautionary tone to the new analysis, emphasizing the risks associated with the unregulated status. * **Change:** The overall nuance has shifted slightly towards highlighting the potential downsides and risks of the current regulatory ambiguity. **Conclusion of Changes:** While the core regulatory status of "Allowed-Unregulated" remains unchanged, the new analysis (June 26, 2025) presents an updated perspective. It incorporates more recent information and introduces a significant new risk assessment from the U.S. INCSR concerning money laundering. Conversely, it omits a previously noted positive development (Banco Nacional ETF). This results in an analysis that, while factually consistent on the primary status, carries a more pronounced cautionary tone regarding the implications of Costa Rica's current approach to cryptocurrency regulation. The analytical result has evolved to reflect new external assessments and a different selection of recent developments.

Analysis ID
#445
Version
Latest
Created
2025-06-26 13:01
Workflow Stage
Live

Executive Summary

Costa Rica permits retail trading of cryptocurrencies, but lacks a dedicated regulatory framework. The Central Bank of Costa Rica (BCCR) does not recognize cryptocurrencies as legal tender, emphasizing that their use is at the individual's own risk. While no specific crypto regulations exist, general AML/CFT laws apply. A proposed "Crypto Assets Market Law" (MECA) is under discussion, but no comprehensive, crypto-specific regulations have been officially implemented as of mid-2025.

Key Pillars

  • Primary Regulator and Approach: The Banco Central de Costa Rica (BCCR) monitors but does not regulate cryptocurrencies, emphasizing user risk. The Superintendency General of Financial Entities (SUGEF) oversees compliance with general financial regulations, including AML/CFT.
  • Core Compliance Requirements: General Anti-Money Laundering (AML) and Counter-Terrorism Financing (CFT) regulations apply to crypto transactions. The Financial Intelligence Unit (UIF) requires financial companies to report suspicious transactions, potentially including crypto-related activities.
  • Licensing/Registration: No specific crypto-related licenses or registration requirements exist.

Landmark Laws

Proposed "Crypto Assets Market Law" (MECA):
- Date: Discussion ongoing as of mid-2025
- Summary: Aims to establish a clearer regulatory framework, including KYC/AML requirements for crypto businesses, but not yet implemented.

Considerations

  • Legal Classification: Cryptocurrencies are not considered legal tender in Costa Rica.
  • Tax Treatment: Favorable tax treatment is reported for cryptocurrency businesses.
  • Risks/Concerns: The U.S. Department of State's 2025 INCSR highlighted virtual currencies as a rising money laundering threat due to the lack of specific regulations.
  • Operational Challenges: The Central Bank of Costa Rica (BCCR) stated that cryptocurrencies cannot be traded on the national payment system.

Notes

  • Historical Context: In 2017 and 2018, the BCCR clarified that cryptocurrencies like Bitcoin are not considered legal tender and are not backed by the Costa Rican government.
  • Future Plans: Discussion about the proposed "Crypto Assets Market Law" (MECA) is ongoing, aiming for a clearer framework, but implementation is pending.
  • Disclaimer: While often described as "unregulated," businesses involved in crypto activities are expected to comply with general Costa Rican laws.
  • Practical Workarounds: Despite the lack of specific regulations, companies are advised to be legally prepared and operate within existing legal boundaries, according to legal and consulting firms.

Detailed Explanation

Costa Rica operates under an "Allowed-Unregulated" status regarding retail trading of cryptocurrencies. This means individuals and businesses can buy, sell, and hold cryptocurrencies, but no specific regulatory framework exists to govern these activities. The Central Bank of Costa Rica (Banco Central de Costa Rica - BCCR) has stated, in 2017 and 2018, that cryptocurrencies like Bitcoin are not considered legal tender, are not backed by the Costa Rican government, and cannot be traded on the national payment system. The BCCR emphasizes that any transactions involving cryptocurrencies are carried out at the individual's own risk; however, their use in private transactions is allowed.

Although there are no specific cryptocurrency regulations, general financial laws, particularly those concerning Anti-Money Laundering (AML) and Counter-Terrorism Financing (CFT), apply. The Superintendency General of Financial Entities (SUGEF) is responsible for ensuring compliance with financial regulations but lacks specific policies dedicated solely to cryptocurrencies. The Financial Intelligence Unit (UIF) requires financial companies to report suspicious transactions, potentially extending to crypto-related activities.

Cryptocurrency adoption is increasing in sectors like tourism and real estate, with some businesses offering to pay salaries partially in cryptocurrency. The government maintains a "laissez-faire" or "vigilant tolerance" approach, observing the crypto space without implementing restrictive measures. According to LegalBison (2025-05-05), cryptocurrency activities are legal as long as they comply with all other existing laws and regulations, specifically security laws and financial regulations. Coinstats (2025-06-24) reports that the neutral regulatory environment and favorable tax treatment have positioned Costa Rica as a preferred venue for cryptocurrency businesses.

However, the U.S. Department of State's 2025 International Narcotics Control Strategy Report (INCSR) highlights virtual currencies as a rising threat for money laundering due to their unregulated nature, echoing concerns voiced by the Costa Rican Drug Institute (ICD) regarding the potential to legitimize drug profits. Some legal and consulting firms suggest that companies can engage in crypto activities if they are properly legally prepared and operate within existing legal boundaries. There has been discussion about a proposed "Crypto Assets Market Law" (MECA) aimed at establishing a clearer framework including KYC/AML requirements; however, as of mid-2025, no comprehensive regulatory framework has been officially implemented. The Central Bank of Costa Rica (CBCR) has established a framework through key directives issued in 2017, 2019, and 2021, though cryptocurrencies remain largely unregulated, according to UPay Blog (2024-11-22).

Summary Points

Retail Trading of Cryptocurrencies in Costa Rica: Regulatory Analysis (2025)

Overall Status: Allowed-Unregulated

  • Retail trading of cryptocurrencies (buying, selling, holding) is permitted for citizens and residents.
  • There is no specific, dedicated regulatory framework for cryptocurrencies.

1. Key Regulatory Bodies & Roles

  • Banco Central de Costa Rica (BCCR) / Central Bank of Costa Rica:
    • Stance: Cryptocurrencies are not legal tender and are not backed by the government.
    • Transactions are at the individual's own risk.
    • Cryptocurrencies cannot be traded on the national payment system.
  • Superintendency General of Financial Entities (SUGEF):
    • Responsible for ensuring compliance with general financial regulations.
    • Does not have specific policies or enforcement mechanisms dedicated solely to cryptocurrencies.
  • Financial Intelligence Unit (UIF):
    • Requires financial companies to report suspicious transactions.
    • This requirement could extend to crypto-related activities.

2. Important Legislation & Regulations

  • No Specific Crypto Legislation: There is no law specifically addressing cryptocurrency businesses or activities.
  • General Financial Laws Apply: Existing financial laws and regulations, particularly those concerning Anti-Money Laundering (AML) and Counter-Terrorism Financing (CFT), apply to entities involved in cryptocurrency transactions.

3. Requirements for Compliance

  • Compliance with General Laws: Businesses involved in crypto activities are expected to comply with general Costa Rican laws (e.g., security laws, financial regulations).
  • AML/CFT Compliance: Financial companies must report suspicious transactions, potentially including crypto-related activities, to the UIF.

4. Notable Restrictions or Limitations

  • Not Legal Tender: Cryptocurrencies are not recognized as legal tender.
  • No Government Backing: Cryptocurrencies are not backed by the Costa Rican government or its laws.
  • Individual Risk: Transactions involving cryptocurrencies are carried out at the individual's own risk.
  • Money Laundering Concerns: Virtual currencies are a rising threat for money laundering due to their unregulated nature.

5. Recent Developments or Changes

  • "Laissez-faire" Approach: The government has generally maintained a "laissez-faire" or "vigilant tolerance" approach, observing the development of the crypto space without implementing restrictive measures.
  • Proposed "Crypto Assets Market Law" (MECA): There has been discussion about potential future regulation, including a proposed law aimed at establishing a clearer framework, including KYC/AML requirements for crypto businesses. As of mid-2025, it has not been implemented.
  • Increased Adoption: Increasing adoption of cryptocurrencies in sectors like tourism and real estate.
  • Warnings from ICD and INCSR: The Costa Rican Drug Institute (ICD) and the U.S. Department of State's International Narcotics Control Strategy Report (INCSR) have warned about the potential for cryptocurrencies to be used for money laundering.

Full Analysis Report

Report on Retail Trading Status of Cryptocurrencies in Costa Rica

Date of Report: 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: Allowed-Unregulated

1. Identified Current Status: Allowed-Unregulated

2. Detailed Narrative Explanation:

Costa Rica currently permits individual citizens and residents to buy, sell, and hold cryptocurrencies. However, the country lacks a specific, dedicated regulatory framework for cryptocurrencies. This means that while the activity is not prohibited, it operates in an environment where no crypto-specific licenses are issued for exchanges, and there are no explicit crypto-focused regulations governing these activities for retail traders.

The Central Bank of Costa Rica (Banco Central de Costa Rica - BCCR) has clarified its stance on several occasions. In 2017 and again in 2018, the BCCR stated that cryptocurrencies like Bitcoin are not considered legal tender, are not backed by the Costa Rican government or its laws, and cannot be traded on the national payment system. The BCCR emphasizes that any transactions involving cryptocurrencies are carried out at the individual's own risk. Despite not being recognized as official currency, their use in private transactions between individuals and businesses is allowed.

While there are no specific crypto regulations, general financial laws and regulations, particularly those concerning Anti-Money Laundering (AML) and Counter-Terrorism Financing (CFT), apply to entities involved in cryptocurrency transactions. The Superintendency General of Financial Entities (SUGEF) is the body responsible for ensuring compliance with financial regulations, but it does not have specific policies or enforcement mechanisms dedicated solely to cryptocurrencies. Companies dealing with digital assets may fall under existing financial service regulations, and the Financial Intelligence Unit (UIF) requires financial companies to report suspicious transactions, which could extend to crypto-related activities.

There is an increasing adoption of cryptocurrencies in Costa Rica, particularly in sectors like tourism and real estate. Some businesses even offer to pay a portion of salaries in cryptocurrency. The government has generally maintained a "laissez-faire" or "vigilant tolerance" approach, meaning it observes the development of the crypto space without implementing restrictive measures.

It is important to note that while often described as "unregulated" in the crypto-specific sense, businesses involved in crypto activities are still expected to comply with general Costa Rican laws. Some legal and consulting firms suggest that companies can perform crypto activities if they are properly legally prepared and operate within existing legal boundaries. There has been discussion about potential future regulation, including a proposed "Crypto Assets Market Law" (MECA) aimed at establishing a clearer framework, including KYC/AML requirements for crypto businesses. However, as of mid-2025, no comprehensive, crypto-specific regulatory framework has been officially implemented.

The U.S. Department of State's 2025 International Narcotics Control Strategy Report (INCSR) highlighted that virtual currencies are a rising threat for money laundering in Costa Rica due to their unregulated nature. This underscores the existing gap in specific regulations and the reliance on general AML frameworks.

Therefore, retail trading of cryptocurrencies in Costa Rica is permitted, but it occurs in an environment that lacks specific, targeted regulations for the crypto industry itself, placing it in the "Allowed-Unregulated" category. Individuals and businesses engaging in crypto activities do so under the umbrella of existing general laws and at their own risk as highlighted by the Central Bank.

3. Specific, Relevant Text Excerpts:

  • LegalBison (2025-05-05): "Yes, cryptocurrency activities are legal in Costa Rica. In the absence of dedicated regulation, Costa Rica tolerates crypto activities, as long as they comply with all other existing laws and regulations of the country. Notably security laws and financial regulations, for the provision of services that may be assimilated as such."
  • LegalBison (2025-05-05): "No law is currently addressing cryptocurrency businesses, meaning that crypto companies are in essence liable to operate freely in this jurisdiction if they comply with the applicable laws."
  • CoinStats (2025-06-24): "The neutral regulatory environment and favorable tax treatment have put Costa Rica on the map as a preferred venue for cryptocurrency businesses. Cryptocurrencies are not recognized by the law as legal tender, making them legal for private transactions, thus serving as quite an accommodating spot for crypto entrepreneurs."
  • CoinStats (2025-06-24): "At present, no particular body has been set up as a regulator for cryptocurrency activities in Costa Rica. The Banco Central de Costa Rica (BCCR) asserts that digital assets are not official currency, while other relevant financial laws and AML go after crypto transactions in general. The Superintendencia General de Entidades Financieras (SUGEF) ensures compliance for financial activities but has no specific enforcement of policies regarding cryptocurrencies."
  • Coinfomania (2025-06-24): "Under the administration of 2025, Costa Rica maintains a decentralized procedure in cryptocurrency oversight, with no law in place specifically regarding digital assets. Instead, crypto-related activities are engaged under the existing legal system of finance and commerce in the country."
  • UPay Blog (2024-11-22): "Adoption status: Cryptocurrency is legal in Costa Rica, but no specific laws regulate it. While not legal tender, it's widely accepted."
  • UPay Blog (2024-11-22): "At the regulatory level, Costa Rica maintains what local media has termed a “vigilant tolerance” approach. The Central Bank of Costa Rica (CBCR) has established a framework through three key directives issued in 2017, 2019, and 2021, though cryptocurrencies remain largely unregulated."
  • AInvest (2025-06-24): "Currently, there is no specific regulatory body overseeing cryptocurrency activities in Costa Rica. The Banco Central de Costa Rica (BCCR) has stated that digital assets are not considered official currency, and relevant financial laws and anti-money laundering (AML) regulations apply to crypto transactions in general."
  • Wikipedia (citing a 2017 Central Bank statement): "In October 2017, the Central Bank of Costa Rica issued a statement that Bitcoin and cryptocurrencies are not considered currencies, are not backed by law, and cannot be traded on Costa Rica's national payment system. The Central Bank emphasized that anyone who used cryptocurrency did so at their own risk."
  • Kryptomoney (2025-04-09): "There is no specific legal framework established for cryptocurrencies, which means the country has a relatively hands-free approach towards crypto asset companies. Businesses and individuals engaging in activities with cryptocurrencies are allowed to do so, but they remain in a gray area without direct governmental oversight."
  • The Tico Times (2025-06-04): "Virtual currencies are a rising threat. Unregulated in Costa Rica, cryptocurrencies like Bitcoin enable anonymous transactions, with their popularity growing among “techspert” criminals. Recently, the Costa Rican Drug Institute (ICD) warned that digital currencies could legitimize drug profits, a concern echoed in the 2025 INCSR."

4. Direct, Accessible URL Links to Sources:

Web Sources (13)

Sources discovered via web search grounding

Search queries used (7)
  • Costa Rica cryptocurrency regulation status 2024 2025
  • retail crypto trading laws Costa Rica 2024 2025
  • Costa Rica AML KYC crypto requirements 2024 2025
  • Banco Central de Costa Rica official statements on cryptocurrency 2024 2025
  • SUGEF Costa Rica cryptocurrency regulations 2024 2025
  • Is cryptocurrency trading legal in Costa Rica for individuals 2024 2025
  • Are there licensed crypto exchanges in Costa Rica 2024 2025
Source

Source

Source

Source

Source

Source

Source

Source

Source

Source

Source

Source

Source

Reviews

No reviews yet

Submit Review

Challenge: Disagree with the analysis | Approval: Confirm it's correct | Refinement: Suggest improvements