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Retail_Trading_Status

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2025-06-26 13:20
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Executive Summary

Retail cryptocurrency trading in Egypt is banned. The primary regulator, the Central Bank of Egypt (CBE), along with the Financial Regulatory Authority (FRA), has consistently warned against cryptocurrency trading, citing risks and the lack of legal protection. The Central Bank and Banking System Law No. 194 of 2020 prohibits the issuance, trading, or promotion of cryptocurrencies without a license from the CBE, which has not issued any such licenses. While individual ownership might not be explicitly illegal, the core activities of retail trading are explicitly prohibited.

Key Pillars

The primary regulator is the Central Bank of Egypt (CBE), which prohibits cryptocurrency activities without a license. Core compliance requirements include adherence to general AML laws like the Anti-Money Laundering Law No. 80 of 2002, although specific KYC/AML regulations for crypto platforms don't exist due to the ban. There are no licensing or registration requirements for cryptocurrency platforms operating legally in Egypt, as such operations are prohibited.

Landmark Laws

  • Central Bank and Banking System Law No. 194 of 2020: Issued in 2020. Article 206 explicitly prohibits the issuance, trading, or promotion of cryptocurrencies (referred to as "cryptographic units") without a license from the Central Bank of Egypt. Violations can lead to imprisonment and fines ranging from EGP 1 million to EGP 10 million.
  • Anti-Money Laundering Law No. 80 of 2002: General AML law that applies to financial institutions. Would presumably apply to any entity if it were ever licensed to deal in cryptocurrencies.

Considerations

Cryptocurrencies are viewed as high-risk investments due to price volatility, potential for financial crimes, and lack of legal protection. Regulators emphasize the risk of cryptocurrencies being used for money laundering and terrorist financing. There is no specific tax treatment for cryptocurrencies as trading is prohibited. Despite the ban, some interest and activity in cryptocurrency trading exist among Egyptians, often through international platforms, which carries significant legal risks.

Notes

In 2018, Egypt's Grand Mufti issued a fatwa stating that cryptocurrencies like Bitcoin are haram (forbidden under Islamic law). The CBE has consistently issued warnings against dealing in cryptocurrencies. The FRA intends to release a list of unlicensed entities offering non-bank financial services related to cryptocurrencies. Some sources suggest individual ownership might not be explicitly illegal, but activities surrounding it are banned. Numerous sources are cited, though some may require login/subscription.

Detailed Explanation

The retail trading of cryptocurrencies in Egypt is currently Banned. This determination is firmly rooted in existing laws and the consistent warnings issued by regulatory bodies, namely the Central Bank of Egypt (CBE) and the Financial Regulatory Authority (FRA). The cornerstone of this prohibition is the Central Bank and Banking System Law No. 194 of 2020. Specifically, Article 206 of this law explicitly forbids the issuance, trading, or promotion of cryptocurrencies – referred to as "cryptographic units" – without obtaining a license from the CBE. As of the date of this report, the CBE has not issued any such licenses. Violators of this law face severe penalties, including imprisonment and substantial fines ranging from EGP 1 million to EGP 10 million. Several sources confirm the illegality of cryptocurrency trading in Egypt under this law, including Andersen in Egypt (January 21, 2025) and ICLG.com (November 7, 2024).

Historically, Egypt's approach to cryptocurrencies has been cautious. Adding to the legal framework, a 2018 fatwa issued by Egypt's Grand Mufti declared that cryptocurrencies like Bitcoin are haram (forbidden under Islamic law) due to their speculative nature and potential for illicit use. While the fatwa is not legally binding, it has undoubtedly influenced public perception and government policy. The CBE has repeatedly issued public warnings against engaging in cryptocurrency transactions, emphasizing the significant risks involved, such as extreme price volatility, the potential for financial crimes (money laundering and terrorist financing), and the lack of legal recourse for users experiencing losses. The CBE maintains that transactions within Egypt must be conducted using officially approved currencies. The Central Bank of Egypt issued warnings as recently as March 8, 2023, reiterating the prohibition to issue and deal in cryptocurrencies.

The Financial Regulatory Authority (FRA) echoes the CBE's warnings, advising citizens against investing in virtual and encrypted currencies due to the absence of regulatory oversight to protect investor rights. The FRA has announced its intention to publish a list of unlicensed entities offering non-bank financial services, including those related to cryptocurrencies, and urges citizens to report suspicious activities. Despite these prohibitions, some reports suggest that there is continued interest in cryptocurrency trading among Egyptians, often conducted through international platforms, as noted by Coinfomania (April 9, 2025) and BitcoinKE on Binance Square (April 2, 2025). This activity occurs outside the legal framework and carries substantial legal risks for those involved.

While the core activities of retail trading are banned, some sources suggest a nuanced perspective: individual ownership of cryptocurrency may not be explicitly illegal, but any activity surrounding it (buying, selling, promoting) falls under the ban. However, this nuance does not change the overall "Banned" status. Regarding KYC/AML, there are no specific regulations tailored for cryptocurrency platforms operating legally in Egypt because such operations are prohibited. However, general AML laws, such as the Anti-Money Laundering Law No. 80 of 2002, apply to financial institutions and would presumably apply to any licensed entity in the future. The consistent warnings from the CBE and FRA about the risks of cryptocurrencies being used in financial crimes indicate that any future regulated environment would involve strict AML/KYC measures. The information provided by CRIF Egypt (June 2, 2025) and Tookitaki reinforces the importance of AML/KYC compliance in the Egyptian financial landscape. In summary, retail cryptocurrency trading remains effectively banned due to the Central Bank and Banking System Law No. 194 of 2020 and the absence of licenses for such activities. Regulatory bodies consistently warn against these activities, citing significant risks and legal consequences.

Summary Points

Retail Cryptocurrency Trading Status in Egypt: Regulatory Analysis (June 26, 2025)

Overall Status: Banned

  • Retail cryptocurrency trading (buying, selling, and promoting) is effectively banned in Egypt.

1. Key Regulatory Bodies and Their Roles

  • Central Bank of Egypt (CBE):
    • Primary regulatory authority regarding currency and banking.
    • Prohibits the issuance, trading, or promotion of cryptocurrencies without a CBE license.
    • Has not issued any licenses for cryptocurrency trading platforms.
    • Consistently issues warnings against dealing in cryptocurrencies due to high risks.
  • Financial Regulatory Authority (FRA):
    • Echoes CBE warnings against investing in cryptocurrencies.
    • Highlights the absence of a regulatory body to protect investor rights in the crypto space.
    • Intends to release a list of unlicensed entities offering non-bank financial services, including crypto-related services.

2. Important Legislation and Regulations

  • Central Bank and Banking System Law No. 194 of 2020:
    • Article 206: Explicitly prohibits the issuance, trading, or promotion of cryptocurrencies ("cryptographic units") without a license from the CBE.
    • Forms the cornerstone of the legal prohibition of cryptocurrency trading.
  • Anti-Money Laundering Law No. 80 of 2002:
    • General AML law applicable to financial institutions.
    • Would likely apply to any licensed cryptocurrency entities in the future.

3. Requirements for Compliance

  • Currently, there are no specific compliance requirements for cryptocurrency trading platforms because they are not legally permitted to operate.
  • If licenses were to be issued in the future, strict AML/KYC measures would be expected.

4. Notable Restrictions and Limitations

  • Prohibition of Trading: Buying, selling, and promoting cryptocurrencies are prohibited without a CBE license.
  • Lack of Legal Protection: Users dealing in cryptocurrencies have no legal protection or recourse for losses.
  • Risk Warnings: Regulatory bodies consistently warn against the high risks associated with cryptocurrencies (price volatility, financial crimes, electronic piracy).
  • Unlicensed Activities: Any cryptocurrency trading activity occurs outside the legal framework and carries significant legal risks.

5. Penalties for Non-Compliance

  • Violations of Article 206 of the Central Bank and Banking System Law No. 194 of 2020 can result in:
    • Imprisonment
    • Fines ranging from EGP 1 million to EGP 10 million.

6. Recent Developments and Changes

  • Consistent Warnings: The CBE and FRA continue to issue warnings against dealing in cryptocurrencies.
  • No Licensing: No licenses have been issued for cryptocurrency trading platforms as of June 2025.
  • Enforcement: The FRA has stated its intention to release a list of unlicensed entities offering non-bank financial services, including those related to cryptocurrencies.
  • Fatwa Influence: While not legally binding, the 2018 fatwa declaring cryptocurrencies "haram" continues to influence public perception and government approach.

7. Nuances

  • Some sources suggest that individual ownership of cryptocurrency might not be explicitly illegal, but any activity surrounding it (buying, selling, promoting) falls under the ban. This nuance does not change the overall "Banned" status for retail trading.

Full Analysis Report

Report on the Current Status of Retail Cryptocurrency Trading in Egypt

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: Banned

Detailed Narrative Explanation:

The current status of retail cryptocurrency trading in Egypt is Banned. This determination is based on existing laws, primarily the Central Bank and Banking System Law No. 194 of 2020, and repeated warnings issued by regulatory authorities, including the Central Bank of Egypt (CBE) and the Financial Regulatory Authority (FRA).

Historically, Egypt's stance on cryptocurrencies has been one of caution and prohibition. In 2018, Egypt's Grand Mufti issued a fatwa (religious decree) stating that cryptocurrencies like Bitcoin are haram (forbidden under Islamic law) due to their speculative nature and potential for illicit use. While this fatwa is a religious opinion and not legally binding, it significantly influenced public perception and the government's approach.

The cornerstone of the legal prohibition is Article 206 of the Central Bank and Banking System Law No. 194 of 2020. This law explicitly prohibits the issuance, trading, or promotion of cryptocurrencies (referred to as "cryptographic units") without a license from the Central Bank of Egypt. To date, the CBE has not issued any such licenses for cryptocurrency trading platforms or related activities. Violations of this law can lead to severe penalties, including imprisonment and substantial fines ranging from EGP 1 million to EGP 10 million.

The Central Bank of Egypt has consistently issued warnings to the public against dealing in cryptocurrencies. These warnings highlight the high risks associated with cryptocurrencies, such as extreme price volatility, potential for financial crimes like money laundering and terrorist financing, electronic piracy, and the lack of legal protection or recourse for users who incur losses. The CBE emphasizes that transactions within Egypt should be conducted only in official, approved currencies.

The Financial Regulatory Authority (FRA) has also echoed these warnings, cautioning citizens against investing in virtual and encrypted currencies and highlighting the absence of a regulatory body to protect investor rights. The FRA has stated its intention to release a list of unlicensed entities offering non-bank financial services, including those related to cryptocurrencies, and urged citizens to report suspicious activities.

Despite the clear legal prohibition and regulatory warnings, some reports indicate that there is still interest and activity in cryptocurrency trading among Egyptians, often through international platforms. However, this activity occurs outside the legal framework and carries significant legal risks for those involved. Some sources suggest that while trading is prohibited, individual ownership itself might not be explicitly illegal, but any activity surrounding it (buying, selling, promoting) falls under the ban. This nuance, however, does not change the overall status from "Banned" as the core activities of retail trading are explicitly prohibited without unobtainable licenses.

Regarding KYC/AML requirements, because cryptocurrency trading is officially banned and no licenses have been issued for exchanges, there are no specific KYC/AML regulations tailored for cryptocurrency platforms operating legally within Egypt. However, general AML laws, such as the Anti-Money Laundering Law No. 80 of 2002, apply to financial institutions and would presumably apply to any entity if it were ever licensed to deal in cryptocurrencies. The CBE and FRA emphasize the risks of cryptocurrencies being used in financial crimes, indicating that any future regulated environment would involve strict AML/KYC measures.

In summary, Egyptian law, through the Central Bank and Banking System Law No. 194 of 2020, explicitly prohibits the unlicensed issuance, trading, or promotion of cryptocurrencies. As no licenses have been granted, retail cryptocurrency trading remains effectively banned for individual citizens and residents. Regulatory bodies continuously warn against such activities, citing significant risks and legal consequences.

Specific, Relevant Text Excerpts:

  • Andersen in Egypt (January 21, 2025): "The question of whether cryptocurrency is legal in Egypt has a clear and definitive answer: cryptocurrencies, including Bitcoin, are illegal under Egyptian law. The Central Bank and Banking System Law (Law No. 194 of 2020) explicitly prohibits the issuance, trading, or promotion of cryptocurrencies without prior approval from the Central Bank of Egypt (CBE)."
  • Andersen in Egypt (January 21, 2025): "Article 206 of this law explicitly prohibits the issuance, trade, or promotion of cryptocurrencies or cryptographic units without prior approval from the CBE. Violating this provision can result in severe penalties, including fines and imprisonment."
  • ICLG.com (November 7, 2024): "Cryptocurrency-based business and trading remain prohibited and restricted in Egypt. The Banking Law No. 194 of 2020 (Article 206 thereof) prohibits issuing, promoting or trading in cryptocurrencies as well as setting up and operating cryptocurrency platforms, unless the approval of the CBE has been obtained in accordance with the requirements to be issued thereby. Moreover, the penalty inflicted on the violator is imprisonment and/or a fine ranging between EGP 1 million and EGP 10 million."
  • ICLG.com (November 7, 2024): "To date, no regulations have been issued [for licensing]. The CBE has, however, issued warnings reiterating the prohibition to issue and deal in cryptocurrencies and that dealings within Egypt must be in the official currencies approved by the CBE, which do not include cryptocurrencies."
  • Central Bank of Egypt (March 8, 2023): "The Central Bank of Egypt reiterates its previous warnings against dealing with all types of cryptocurrencies; whether through individuals, companies, applications, or digital platforms. Thereby, the Central Bank of Egypt emphasizes that no license has ever been issued or granted to engage in such trading activities in the Egyptian market due to the high risks they comprise..."
  • Coinfomania (April 9, 2025): "Egypt holds a very restrictive position on cryptocurrency. CBE has explicitly banned any issues or trading of cryptocurrencies without prior approval from the authority. While it is not illegal to have individual ownership of what could be your own cryptocurrency, the activities around cryptocurrencies are still subject to severe penalties." (Note: While this source mentions individual ownership might not be illegal, the surrounding prohibited activities make retail trading banned).
  • I&D Law Firm (Undated, accessed June 2024): "In Egypt, trading and holding cryptocurrencies are prohibited under Article (206) of Law No. 194 of 2020. This regulation is part of a broader effort to mitigate risks related to financial instability and illicit activities that could arise from unregulated digital currencies."
  • AGBI (May 12, 2025): "The FRA noted that Egypt's central bank issued a law in 2020 criminalising the dealing in and promoting of cryptocurrencies, adding that the law reflected the legislative approach taken by financial authorities to address the risks associated with these investments."
  • LARA on the Block (May 13, 2025): "Egyptian law prescribes imprisonment and/or a fine of one to ten million Egyptian pounds for anyone trading, promoting or offering activities related to these currencies without prior authorization from the relevant bodies.”

Direct, Accessible URL Links to Sources:

  1. Andersen in Egypt - The Legality of Cryptocurrency in Egypt (January 21, 2025): https://www.andersen.com/eg/insights/legal-alerts/2025/01/the-legality-of-cryptocurrency-in-egypt/
  2. ICLG.com - Fintech Laws and Regulations Report 2024-2025 Egypt (November 7, 2024): https://iclg.com/practice-areas/fintech-laws-and-regulations/egypt
  3. Umoja Protocol - The State of Crypto Regulation: Egypt (Undated, accessed June 2024, references 2020 law): https://medium.com/umoja-protocol/the-state-of-crypto-regulation-egypt-29e8b9a19888 (Note: Some interpretations in this article about "lifting of the ban" seem to conflict with primary legal sources and other analyses, the core legal prohibition remains.)
  4. Cointelegraph - An overview of crypto regulations in Egypt (April 22, 2024, Updated Aug 1, 2024): https://cointelegraph.com/learn/an-overview-of-crypto-regulations-in-egypt
  5. Central Bank of Egypt - The Fourth (4th) Warning Statement on Cryptocurrencies (March 8, 2023): https://www.cbe.org.eg/en/news-publications/news/2023/03/08/09/00/the-fourth-4th-warning-statement-on-cryptocurrencies
  6. Coinfomania - Cryptocurrency Regulations in Egypt (April 9, 2025, Updated April 17, 2025): https://coinfomania.com/cryptocurrency-regulations-in-egypt/
  7. BitcoinKE on Binance Square - The Crypto Landscape in Egypt and How Users Can Navigate Potential Issues (April 2, 2025): https://www.binance.com/en/square/post/7008809631024 (Note: This article discusses user activity but acknowledges the prohibitive regulatory stance.)
  8. I&D Law Firm - The Rise and Fall of Cryptocurrencies (Undated, references Law No. 194 of 2020): https://idfirm.com/articles/the-rise-and-fall-of-cryptocurrencies/
  9. AGBI - Egypt renews warning over dealing in cryptocurrencies (May 12, 2025): https://www.agbi.com/finance/2025/05/egypt-renews-warning-over-dealing-in-cryptocurrencies/
  10. UEEx Technology - Best Crypto Exchanges in Egypt (2025) (April 9, 2025): https://www.ueex.com/blog/best-crypto-exchanges-in-egypt-2025-en/ (Note: This article discusses international exchanges used by Egyptians but acknowledges the lack of official approval.)
  11. Coinfomania - Crypto Taxation in Egypt: A Complete Guide (April 17, 2025): https://coinfomania.com/crypto-taxation-in-egypt-a-complete-guide/
  12. Lexis Middle East - Cryptocurrency legality in Egypt (May 28, 2025): https://www.lexismiddleeast.com/news/2025-05-28_10 (Site may require login/subscription for full access)
  13. LARA on the Block - Egyptian Financial regulator warns against investing in crypto again (May 13, 2025): https://laraontheblock.com/2025/05/13/egyptian-financial-regulator-warns-against-investing-in-crypto-again/
  14. CRIF Egypt - AML & KYC Compliance 2025: Trends, Tech & Regulatory Updates (June 2, 2025): https://www.crif.com.eg/news/2025/06/aml-kyc-compliance-2025-trends-tech-regulatory-updates/
  15. ElectronicPublications - The Impact of Islamic Law on Cryptocurrency Regulation in Egypt (Undated, references Law No. 194 of 2020): https://www.electronicpublications.org/index.php/AJLH/article/view/1020 (Site may require login/subscription for full access)
  16. Tookitaki - How Tookitaki Helps Egyptian Businesses Comply with AML Regulations (Undated, references Law No. 80 of 2002): https://www.tookitaki.ai/newsroom/how-tookitaki-helps-egyptian-businesses-comply-with-aml-regulations/

Web Sources (16)

Sources discovered via web search grounding

Search queries used (9)
  • current status of retail cryptocurrency trading in Egypt 2024 2025
  • Egypt cryptocurrency laws and regulations for individuals
  • Central Bank of Egypt cryptocurrency stance 2024 2025
  • Financial Regulatory Authority Egypt cryptocurrency retail trading
  • Is it legal to buy and sell crypto in Egypt for individuals?
  • KYC/AML regulations for cryptocurrency platforms in Egypt
  • Official statements on cryptocurrency trading in Egypt 2024 2025
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