Grenada
Retail_Trading_Status
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- #674
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- 2025-12-12 04:20
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Executive Summary
Retail cryptocurrency trading is legal and regulated in Grenada under the Virtual Asset Business Act, 2021. The Grenada Authority for the Regulation of Financial Institutions (GARFIN) serves as the primary regulator, overseeing the registration and supervision of Virtual Asset Service Providers (VASPs). While the legislative framework is fully enacted with regulations gazetted in May 2024, the licensing regime is in its early operational stages, with applications being accepted but few, if any, licenses issued as of mid-2024.
Key Pillars
Primary Regulator: Grenada Authority for the Regulation of Financial Institutions (GARFIN)
Regional Monetary Authority: Eastern Caribbean Central Bank (ECCB)
Core Legislation: Virtual Asset Business Act, 2021 (Act No. 7 of 2021)
Operational Regulations: Virtual Asset Business Regulations 2024 (S.R.O. 9 of 2024)
Compliance: Mandatory VASP registration, AML/CFT compliance, and client asset segregation (40% escrow requirement)
Landmark Laws
Virtual Asset Business Act, 2021 (Act No. 7 of 2021) - Enacted: 2021-07-23
- Establishes the legal framework for the registration and supervision of virtual asset businesses. Defines virtual assets, mandates registration for VASPs, and sets penalties for non-compliance (fines up to EC$10,000 and imprisonment).
- Source
Virtual Asset Business Regulations 2024 (S.R.O. 9 of 2024) - Enacted: 2024-05-24
- Provides operational details for the 2021 Act, including application fees (EC$2,500), registration fees (EC$10,000), and specific timelines for application review (90 days).
- Source
Considerations
Taxation: Crypto is generally treated as property/intangible asset. Residents are subject to a 15% Capital Gains Tax (often cited for short-term gains).
VAT: A 15% Value Added Tax applies to goods and services purchased with cryptocurrency.
Non-Resident Benefits: Non-residents (e.g., digital nomads) may benefit from 0% tax on foreign-sourced income/capital gains.
Licensing Lag: While the law is from 2021, regulations were only gazetted in May 2024, meaning the licensing regime is effectively very new.
Regional Context: Grenada is part of the ECCU; the ECCB launched the DCash CBDC pilot, indicating a regional openness to digital assets.
Notes
Grenada's regulatory environment was heavily publicized during the tenure of Justin Sun (founder of Tron) as its WTO Ambassador, though his diplomatic status ended around 2023. The country is moving from a 'paper' regulatory state to an operational one with the 2024 regulations.
Remaining Uncertainties
- Confirmation of the first batch of licenses actually issued under the 2024 regulations.
- Specifics on the 'short-term' vs 'long-term' holding period for capital gains tax applicability.
- Whether any specific 'travel rule' implementation guidelines have been released by GARFIN.
Detailed Explanation
Detailed Explanation
Retail cryptocurrency trading is legal and regulated in Grenada under a fully enacted legislative framework. The primary governing law is the Virtual Asset Business Act, 2021 (Act No. 7 of 2021), which was enacted on July 23, 2021. This Act establishes the legal basis for the registration and supervision of Virtual Asset Service Providers (VASPs), defines virtual assets, and sets penalties for non-compliance, including fines up to EC$10,000 and imprisonment. The Grenada Authority for the Regulation of Financial Institutions (GARFIN) serves as the primary national regulator, overseeing the registration and supervision of VASPs. Regionally, the Eastern Caribbean Central Bank (ECCB) is the monetary authority, having launched the DCash central bank digital currency (CBDC) pilot, indicating a broader regional openness to digital assets within the Eastern Caribbean Currency Union (ECCU).
The operational details for the regulatory regime are provided by the Virtual Asset Business Regulations 2024 (S.R.O. 9 of 2024), which were gazetted on May 24, 2024. These regulations specify application procedures, including a non-refundable application fee of EC$2,500, a registration fee of EC$10,000 upon approval, and a mandated 90-day review period for applications. Key compliance requirements for VASPs include mandatory registration with GARFIN, adherence to Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) standards, and a strict client asset segregation rule requiring 40% of client funds to be held in escrow. From a taxation perspective, cryptocurrency is generally treated as property or an intangible asset. Residents are subject to a 15% Capital Gains Tax, often applied to short-term gains, and a 15% Value Added Tax (VAT) applies to goods and services purchased with cryptocurrency. However, non-residents, such as digital nomads, may benefit from a 0% tax rate on foreign-sourced income and capital gains.
It is important to note that while the legislative framework is complete, the licensing regime is in its very early operational stages. With the regulations only coming into force in May 2024, GARFIN is accepting applications but, as of mid-2024, few if any licenses have been issued. This signifies Grenada's transition from having a 'paper' regulatory framework to building an operational one. The country's regulatory environment gained international attention during the tenure of Justin Sun, founder of Tron, as its WTO Ambassador, though his diplomatic status concluded around 2023.
Summary Points
I. Regulatory Status
* Retail cryptocurrency trading is legal and regulated.
* Status: Allowed-Regulated under the Virtual Asset Business Act, 2021.
II. Key Regulatory Bodies
* Grenada Authority for the Regulation of Financial Institutions (GARFIN)
* Primary national regulator for Virtual Asset Service Providers (VASPs).
* Oversees registration, supervision, and compliance.
* Eastern Caribbean Central Bank (ECCB)
* Regional monetary authority for the Eastern Caribbean Currency Union (ECCU).
* Launched the DCash CBDC pilot, indicating regional openness to digital assets.
III. Important Legislation
* Virtual Asset Business Act, 2021 (Act No. 7 of 2021)
* Enacted: 2021-07-23.
* Establishes the legal framework for VASP registration and supervision.
* Defines virtual assets and mandates registration.
* Sets penalties for non-compliance (fines up to EC$10,000 and imprisonment).
* Virtual Asset Business Regulations 2024 (S.R.O. 9 of 2024)
* Enacted: 2024-05-24.
* Provides operational details for the 2021 Act.
* Specifies application fee (EC$2,500), registration fee (EC$10,000), and a 90-day application review timeline.
IV. Compliance Requirements
* Mandatory registration as a Virtual Asset Service Provider (VASP) with GARFIN.
* Adherence to Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) standards.
* Client asset segregation with a requirement to hold 40% of client funds in escrow.
* Taxation:
* Cryptocurrency is treated as property/intangible asset.
* Residents subject to 15% Capital Gains Tax (often for short-term gains).
* 15% Value Added Tax (VAT) applies to goods/services purchased with crypto.
* Non-residents (e.g., digital nomads) may benefit from 0% tax on foreign-sourced income/capital gains.
V. Notable Restrictions or Limitations
* Licensing Lag: Although the primary law was enacted in 2021, the detailed regulations were only gazetted in May 2024. The licensing regime is therefore very new and in its early operational stages, with applications being accepted but few, if any, licenses issued as of mid-2024.
VI. Recent Developments or Notes
* The country is moving from a 'paper' regulatory state to an operational one with the enactment of the 2024 Regulations.
* Grenada's regulatory environment was heavily publicized during the tenure of Justin Sun (founder of Tron) as its WTO Ambassador; his diplomatic status ended around 2023.
Full Analysis Report
Full Analysis Report
Grenada has established a formal regulatory environment for cryptocurrencies through the enactment of the Virtual Asset Business Act, 2021. This legislation, which aligns with the Eastern Caribbean Currency Union's (ECCU) regional harmonization efforts, designates the Grenada Authority for the Regulation of Financial Institutions (GARFIN) as the competent authority for supervising Virtual Asset Service Providers (VASPs). The Act mandates that any entity offering virtual asset services—such as exchanges, transfer services, or custody providers—must register with GARFIN. Operating without registration is a criminal offense punishable by fines and imprisonment.
Although the primary legislation was passed in 2021, the operational framework was only fully actualized with the gazetting of the Virtual Asset Business Regulations 2024 on May 24, 2024. These regulations clarified the fee structure (EC$2,500 for application, EC$10,000 for registration) and the review process. Following this, GARFIN issued public notices inviting VASPs to register. As of mid-2024, the registry was open, though reports indicated that the issuance of the first batch of licenses was still pending the processing of these new applications. This places Grenada in an 'Allowed-Regulated' status, distinct from a 'Gray-Zone' because the laws are permanent and the regulator is actively soliciting compliance.
From a retail perspective, individuals are free to buy, sell, and hold cryptocurrencies. There are no prohibitions on retail trading. However, the Eastern Caribbean Central Bank (ECCB), the monetary authority for the region, frequently issues warnings regarding the high risks, volatility, and lack of consumer protection associated with unregulated crypto assets. The ECCB distinguishes clearly between private cryptocurrencies and its own Central Bank Digital Currency (CBDC) project, DCash, which is legal tender.
Taxation of cryptocurrency in Grenada is based on existing property and income tax laws rather than specific crypto-tax legislation. Capital gains are generally taxed at 15% for residents, particularly on short-term trading profits. However, Grenada is often marketed as a tax-friendly jurisdiction for non-residents and digital nomads, who may be exempt from taxes on foreign-sourced income and capital gains. Additionally, the use of crypto to purchase goods and services attracts the standard 15% VAT.
Grenada has established a formal regulatory environment for cryptocurrencies through the enactment of the **Virtual Asset Business Act, 2021**. This legislation, which aligns with the Eastern Caribbean Currency Union's (ECCU) regional harmonization efforts, designates the **Grenada Authority for the Regulation of Financial Institutions (GARFIN)** as the competent authority for supervising Virtual Asset Service Providers (VASPs). The Act mandates that any entity offering virtual asset services—such as exchanges, transfer services, or custody providers—must register with GARFIN. Operating without registration is a criminal offense punishable by fines and imprisonment. Although the primary legislation was passed in 2021, the operational framework was only fully actualized with the gazetting of the **Virtual Asset Business Regulations 2024** on May 24, 2024. These regulations clarified the fee structure (EC$2,500 for application, EC$10,000 for registration) and the review process. Following this, GARFIN issued public notices inviting VASPs to register. As of mid-2024, the registry was open, though reports indicated that the issuance of the first batch of licenses was still pending the processing of these new applications. This places Grenada in an 'Allowed-Regulated' status, distinct from a 'Gray-Zone' because the laws are permanent and the regulator is actively soliciting compliance. From a retail perspective, individuals are free to buy, sell, and hold cryptocurrencies. There are no prohibitions on retail trading. However, the **Eastern Caribbean Central Bank (ECCB)**, the monetary authority for the region, frequently issues warnings regarding the high risks, volatility, and lack of consumer protection associated with unregulated crypto assets. The ECCB distinguishes clearly between private cryptocurrencies and its own Central Bank Digital Currency (CBDC) project, **DCash**, which is legal tender. Taxation of cryptocurrency in Grenada is based on existing property and income tax laws rather than specific crypto-tax legislation. Capital gains are generally taxed at **15%** for residents, particularly on short-term trading profits. However, Grenada is often marketed as a tax-friendly jurisdiction for non-residents and digital nomads, who may be exempt from taxes on foreign-sourced income and capital gains. Additionally, the use of crypto to purchase goods and services attracts the standard **15% VAT**.
Source Evidence
Primary and secondary sources cited in this analysis
"An Act to provide for the registration and supervision of virtual asset business from Grenada and with persons in Grenada."
"Virtual assets service providers are regulated in accordance with the Virtual Asset Business Act, Act No. 7 of 2021."
"Regulations have been gazetted to guide the registration and operation of virtual businesses in Grenada... S.R.O. 9 of 2024."
"Grenada applies a 15.0% capital gains tax rate on short-term cryptocurrency gains."
"The ECCB encourages the public to exercise due diligence and to be mindful of the high level of risk crypto-assets present."
Web Sources (7)
Sources discovered via web search grounding
Search queries used (9)
- GARFIN Grenada cryptocurrency regulation
- Grenada crypto trading legality
- Grenada Virtual Asset Business Act enacted
- Eastern Caribbean Central Bank virtual assets regulation
- Grenada Virtual Asset Business Act 2021 gazette
- Grenada cryptocurrency tax capital gains
- Grenada Virtual Asset Business Act 2021 text
- Justin Sun Grenada crypto ambassador status 2025
- GARFIN Grenada VASP register list
https://grenadaparliament.gd/wp-content/uploads/2021/09/Virtual_Asset_Business_Bill_20211.pdf
https://blog.mexc.com/wiki/are-there-any-taxes-for-crypto-in-grenada/
https://cryptonomadhub.io/countries/gd
https://charltonsquantum.com/wp-content/uploads/docs/grenada-crypto-guide.pdf
https://charltonsquantum.com/grenada-virtual-assets-regulation/
https://blog.upay.best/crypto-adoption/grenada/
https://www.theblock.co/post/224319/justin-sun-grenada-wto-ambassador