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Monaco

Retail_Trading_Status

Allowed-Regulated Unknown
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Analysis ID
#564
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Latest
Created
2025-06-26 13:28
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Live

Executive Summary

Monaco permits retail cryptocurrency trading, attracting investors with no personal income or capital gains tax on crypto assets for residents. While no overarching crypto legislation exists, digital assets are treated as regular financial instruments under existing frameworks, particularly AML/CTF. Law No. 1.528 (July 7, 2022) regulates crypto asset service providers, requiring licenses and compliance with KYC/AML regulations overseen by the Autorité Monégasque de Sécurité Financière (AMSF). The Financial Supervisory Commission (CCAF) warns of risks and prohibits direct marketing of crypto services by unauthorized companies.

Key Pillars

The primary regulator is the Autorité Monégasque de Sécurité Financière (AMSF), Monaco's financial intelligence unit, which oversees compliance with AML and KYC regulations. Core compliance requirements include Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations for crypto asset service providers. Companies operating in the cryptocurrency sector, such as exchanges and custody services, must obtain a license from Monegasque authorities and adhere to transparency and fund security requirements.

Landmark Laws

Law No. 1.528, enacted on July 7, 2022: Established a regulatory framework for services related to crypto assets, requiring service providers to obtain a license and comply with transparency and fund security requirements.
Law 1.362 on anti-money laundering, as modified: Explicitly subjects crypto asset service providers to AML obligations, including data sharing under the 'travel rule,' detecting unusual transactions, and declaring suspicious activities.

Considerations

Crypto assets are treated as regular financial instruments rather than legal tender. Individuals trading for personal use are generally not subject to specific crypto taxes on gains, but businesses dealing in crypto are required to comply with AML and KYC regulations. The CCAF warns the public about risks such as loss of funds, lack of liquidity, volatility, and potential for fraud or money laundering. Direct marketing of financial products, including certain crypto-asset services, by unauthorized companies is prohibited.

Notes

Monaco's tax policy, characterized by the absence of personal income tax and low corporate taxes, extends to cryptocurrencies for individuals, where profits from crypto trading are tax-free. Law 1.528 requires trading platforms and digital wallets to comply with strict user verification obligations. The Autorité Monégasque de Sécurité Financière (AMSF) oversees compliance with AML/KYC requirements for businesses dealing in crypto. The CCAF emphasizes that crypto-assets are not guaranteed by a Central Bank and are not subject to specific regulation in the same way as traditional currencies.

Detailed Explanation

Monaco permits individual citizens and residents to buy, sell, and hold cryptocurrencies without prohibition. The principality's financial environment is attractive to crypto investors due to the absence of personal income tax and capital gains tax on such assets for Monegasque residents. However, Monaco does not have a specific, overarching legislation comprehensively addressing cryptocurrencies as a distinct asset class. Instead, digital assets are generally treated as regular financial instruments and fall under existing financial regulatory frameworks, particularly concerning Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF). A key development is Law No. 1.528, enacted on July 7, 2022, which clarifies and establishes a regulatory framework for crypto asset services, mandating that companies operating in the cryptocurrency sector, such as exchanges or custody services, obtain a license from Monegasque authorities and adhere to transparency and fund security requirements. These service providers must comply with strict Know Your Customer (KYC) and AML regulations, including thorough customer due diligence, identity verification, understanding the nature of their business, assessing risks, and reporting suspicious transactions to the Autorité Monégasque de Sécurité Financière (AMSF), Monaco's financial intelligence unit. Law 1.362 on anti-money laundering, as modified, explicitly subjects crypto asset service providers to these AML obligations, including data sharing under the "travel rule," detecting unusual transactions, and declaring suspicious activities. While individuals trading for personal use are generally not subject to specific crypto taxes on their gains, businesses dealing in crypto must comply with AML and KYC regulations. The Financial Supervisory Commission (Commission de Contrôle des Activités Financières - CCAF) has issued warnings, emphasizing that crypto-assets are not legal tender, are not guaranteed by a Central Bank, and are not subject to specific regulation in the same way as traditional currencies. The CCAF advises extreme prudence due to risks such as loss of funds, lack of liquidity, volatility, and potential for fraud or money laundering, stressing that direct marketing of financial products, including certain crypto-asset services, by unauthorized companies is prohibited. The overall regulatory approach is 'Allowed-Regulated', with increasing scrutiny, licensing, and stringent AML/KYC requirements for platforms and entities facilitating cryptocurrency activities.

Summary Points

Retail Cryptocurrency Trading in Monaco: Regulatory Overview

1. General Status:

  • Allowed-Regulated: Individuals can buy, sell, and hold cryptocurrencies. However, the industry is subject to increasing regulation, particularly for service providers.

2. Key Regulatory Bodies:

  • Autorité Monégasque de Sécurité Financière (AMSF): Monaco's financial intelligence unit.
    • Oversees compliance with AML/KYC regulations for businesses dealing in crypto.
    • Receives reports of suspicious transactions.
  • Commission de Contrôle des Activités Financières (CCAF): Financial Supervisory Commission.
    • Issues warnings to the public regarding the risks associated with crypto-assets.
    • Prohibits direct marketing of financial products (including some crypto-asset services) by unauthorized companies.

3. Important Legislation and Regulations:

  • Law No. 1.528 (July 7, 2022): Framework for crypto asset services.
    • Requires licensing for companies operating in the cryptocurrency sector (e.g., exchanges, custody providers).
    • Subjects licensed entities to supervision, transparency, and fund security requirements.
  • Law No. 1.362 (as modified): Anti-Money Laundering Law.
    • Subjects crypto asset service providers to AML obligations.
    • Includes KYC requirements, data sharing ("travel rule"), detection of unusual transactions, and reporting suspicious activities.

4. Compliance Requirements:

  • For Crypto Asset Service Providers (e.g., Exchanges, Custody Services):
    • Licensing: Must obtain a license from Monegasque authorities to operate.
    • AML/KYC: Strict compliance with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations.
      • Thorough customer due diligence and identity verification.
      • Understanding the nature of customer business.
      • Assessing risks.
      • Reporting suspicious transactions to the AMSF.
    • Transparency and Fund Security: Subject to requirements for transparency and fund security.
  • For Businesses Dealing in Crypto:
    • Must comply with AML and KYC regulations, including legal entities accepting digital assets as payment.

5. Notable Restrictions and Limitations:

  • No Legal Tender Status: Crypto-assets are not legal tender in Monaco.
  • No Central Bank Guarantee: Crypto-assets are not guaranteed by a Central Bank.
  • Lack of Specific Regulation (Compared to Traditional Currencies): Crypto-assets are not subject to the same specific regulations as traditional currencies.
  • CCAF Warnings: Public warnings issued by the CCAF emphasize the risks associated with crypto-assets, including:
    • Loss of funds
    • Lack of liquidity
    • Volatility
    • Potential for fraud and money laundering
  • Prohibition of Unauthorized Direct Marketing: Direct marketing of financial products (including certain crypto-asset services) by unauthorized companies is prohibited.

6. Recent Developments and Changes:

  • Law No. 1.528 (July 7, 2022): Introduced a regulatory framework for crypto asset service providers, requiring licensing and compliance with specific rules.
  • Ongoing Implementation: Further implementing texts are expected to clarify and expand upon the regulatory regime for crypto asset service providers.

7. Tax Implications:

  • Individuals:
    • No specific taxes on cryptocurrencies for individuals.
    • Profits from crypto trading are tax-free.
    • No personal income tax or capital gains tax for Monegasque residents.
  • Businesses:
    • Businesses dealing in crypto are required to comply with AML and KYC regulations.

Full Analysis Report

Report on the Current Status of Retail Cryptocurrency Trading in Monaco

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).

1. Identified Current Status: Allowed-Regulated

2. Detailed Narrative Explanation:

Monaco permits its individual citizens and residents to buy, sell, and hold cryptocurrencies. This activity is not prohibited, and the general financial environment in Monaco is considered attractive for crypto investors due to the absence of personal income tax and capital gains tax on such assets for Monegasque residents.

However, the landscape is not entirely unregulated. While Monaco has not introduced a specific, overarching legislation that comprehensively addresses all aspects of cryptocurrencies as a distinct asset class, digital assets are generally treated like regular financial instruments and fall under existing financial regulatory frameworks, particularly concerning Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF).

A significant development in this area is Law No. 1.528, enacted on July 7, 2022. This law brought important clarifications and established a regulatory framework for services related to crypto assets, particularly for service providers. It mandates that companies wishing to operate in the cryptocurrency sector in Monaco, such as exchanges or those providing custody services, must obtain a license from the Monegasque authorities. These entities are subject to supervision and must adhere to transparency and fund security requirements.

Crucially, these service providers are obligated to comply with strict Know Your Customer (KYC) and AML regulations. This includes thorough customer due diligence, identity verification, understanding the nature of their business, assessing risks, and reporting suspicious transactions to the Autorité Monégasque de Sécurité Financière (AMSF), Monaco's financial intelligence unit. Law 1.362 on anti-money laundering, as modified, explicitly subjects crypto asset service providers to these AML obligations, including data sharing under the "travel rule," detecting unusual transactions, and declaring suspicious activities.

While individuals trading for personal use are generally not subject to specific crypto taxes on their gains, businesses dealing in crypto are required to comply with AML and KYC regulations. The Financial Supervisory Commission (Commission de Contrôle des Activités Financières - CCAF) has issued warnings to the public, emphasizing that crypto-assets are not legal tender, are not guaranteed by a Central Bank, and are not subject to specific regulation in the same way as traditional currencies. The CCAF also advises extreme prudence when investing in crypto-assets due to risks such as loss of funds, lack of liquidity, volatility, and potential for fraud or money laundering. They stress that any direct marketing of financial products, which could include certain crypto-asset services, by unauthorized companies in Monaco is prohibited.

Therefore, while individuals are free to engage in cryptocurrency trading, the platforms and entities facilitating these activities are increasingly subject to regulatory scrutiny, licensing, and stringent AML/KYC requirements, placing the overall status as 'Allowed-Regulated'.

3. Specific, Relevant Text Excerpts:

  • O2K (2024): "The law requires trading platforms, digital wallets, and other industry players to comply with strict user verification obligations. These obligations include rigorous measures to comply with KYC (Know Your Customer) and AML regulations. This means that anyone wishing to trade or use cryptocurrencies must prove their identity to prevent any illicit use of digital assets."
  • O2K (2024): "Companies wishing to operate in the cryptocurrency sector in Monaco must obtain a license from Monegasque authorities. These companies are subject to regular supervision, with requirements for transparency and fund security."
  • O2K (2024): "As of now, Monaco does not impose any specific taxes on cryptocurrencies [for individuals]. This approach aligns with its broader tax policy, characterized by the absence of personal income tax and low corporate taxes."
  • HelloMonaco (2025): "Individuals who buy and hold digital assets can do so tax-free whether they hold them as a store of value or use them for transactions. Profits from crypto trading are tax-free. This is also derived from Monaco not imposing a capital gains tax."
  • HelloMonaco (2025): "Businesses that deal in crypto are, however, required to comply with AML and KYC regulations. This includes all legal entities that accept digital assets as a method of payment. The Autorité Monégasque de Sécurité Financière (AMSF), Monaco's financial intelligence unit, oversees all compliance with the said requirements."
  • Delforge Law (2022) on L aw 1.528: "The new law specifies what type of services and crypto assets undertaken in Monaco are considered as regulated activities subject to specific regulatory requirements. Among such services are the following: the exchange of virtual assets against other virtual assets, the operation of a negotiation platform for virtual assets, etc. The new Law sets a requirement to apply for a prior licence to conduct such regulated activities in Monaco."
  • Gordon's Blair (on Law 1.528 of July 7, 2022): "Since the adoption of Law 1.528 on July, 7 2022, the “digital investors” can rely on a dynamic and more detailed legal framework in Monaco... Law 1.528 introduces a series of conditions in relation to the provision of services on digital assets and the provision of investment services on crypto assets..."
  • AMAF - CCAF (Warning): "The Commission de Contrôle des Activités Financières (CCAF) warns the public that crypto-assets (such as Bitcoin, Ethereum, Ripple, Monoeci etc.), commonly referred to as "virtual currencies" or "cryptocurrencies" do not qualify as currencies and are not subject to a specific regulation. These crypto-assets are not legal tender and are not a means of exchange which value is guaranteed by a Central Bank."
  • DL Corporate & Regulatory (2023) on Law 1.362: "Law 1.362 dated 3 August 2009 as modified on anti-money laundering which submits crypto asset service providers to the main AML obligations which are knowing your client (KYC and source of wealth), data sharing as imposed by the “travel rule” principle, detecting unusual transactions (KYT and sanction scrutiny) and declaring suspicious transactions (SARs and other disclosures to the local FIU)."
  • DL Corporate & Regulatory (2023) on Law 1.528: "Law 1.528 dated 7 July 2022 which starts building the regulatory regime applicable to crypto asset service providers with the requirement to receive a prior authorization and comply with organizational and conduct of business rules – awaiting further implementing texts."

4. Direct, Accessible URL Links to Specific Sources:

Web Sources (7)

Sources discovered via web search grounding

Search queries used (5)
  • current status of retail cryptocurrency trading in Monaco
  • Monaco cryptocurrency laws and regulations for individuals 2025
  • KYC/AML requirements for crypto platforms in Monaco
  • Official statements from Monaco regulators on cryptocurrency trading by residents
  • Are individuals in Monaco permitted to buy sell and hold cryptocurrencies
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