Kiribati
Retail_Trading_Status
- Analysis ID
- #701
- Version
- Latest
- Created
- 2025-12-12 04:42
- Run
- 638a7416...
- History
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- Workflow Stage
- Step 1
Executive Summary
Retail cryptocurrency trading is legally permitted in Kiribati due to the absence of specific prohibitory legislation, placing it in a regulatory gray area effectively functioning as an unregulated market. There is no dedicated licensing regime for Virtual Asset Service Providers (VASPs), and the country lacks a specific framework for digital asset taxation or consumer protection. The sector is largely governed by general criminal and civil laws, such as the Cybercrime Act 2021, while the government has historically been vulnerable to dubious 'sovereign' crypto projects. Investors should exercise extreme caution due to the lack of regulatory oversight and the prevalence of high-profile scams targeting the jurisdiction.
Key Pillars
Ministry of Finance and Economic Development (General financial oversight)
Kiribati Police Service (Cybercrime Unit for enforcement)
No specific VASP licensing regime exists
General Income Tax laws apply to business-like trading activities
Landmark Laws
Cybercrime Act 2021 (Act No. 10 of 2021) - Enacted: 2021-08-01
- Primary legislation addressing computer-related offenses. While not specific to crypto, it criminalizes unauthorized access, data interference, and computer-related fraud, providing a legal basis to prosecute crypto-related cybercrimes.
- Source
Considerations
No consumer protection: Users have no recourse against exchange insolvency or fraud.
High Scam Risk: The country has been targeted by fraudulent 'sovereign' crypto schemes (e.g., World Digital Central Bank) that obtained business registrations but are not legitimate regulatory bodies.
Taxation: No specific capital gains tax for individuals, but frequent trading may be treated as taxable business income under general tax rules.
Infrastructure: Limited internet connectivity and banking infrastructure significantly hamper practical crypto adoption.
Notes
The 'World Digital Central Bank' mentioned in some search results is widely regarded as a scam or at least a highly dubious entity linked to convicted fraudsters, despite claiming government authorization. It should not be confused with a legitimate Central Bank Digital Currency (CBDC) or regulatory body.
Remaining Uncertainties
- Whether the government plans to introduce a specific VASP bill following regional trends.
- The exact status of the 'World Digital Central Bank' entities—whether their business registrations have been revoked following fraud allegations.
- Specific banking policies regarding crypto transfers (often handled by Australian correspondent banks).
Detailed Explanation
Detailed Explanation
Retail cryptocurrency trading is legally permitted and operates in an unregulated status in Kiribati due to the absence of specific prohibitory legislation. This creates a regulatory gray area where the activity is allowed but not formally supervised by a dedicated financial authority. The sector is largely governed by general criminal and civil laws, with no dedicated licensing regime for Virtual Asset Service Providers (VASPs), no specific framework for digital asset taxation, and no formal consumer protection mechanisms for users against exchange insolvency or fraud. The primary regulatory oversight for financial matters generally falls under the Ministry of Finance and Economic Development, while enforcement against cybercrimes, including those potentially involving cryptocurrencies, is handled by the Kiribati Police Service's Cybercrime Unit. The key piece of legislation that provides a tangential legal basis for addressing malicious crypto-related activities is the Cybercrime Act 2021 (Act No. 10 of 2021), enacted on 2021-08-01. This act criminalizes offenses such as unauthorized access, data interference, and computer-related fraud, which could be applied to prosecute certain crypto-related scams or hacks. From a taxation perspective, there is no specific capital gains tax on digital assets for individuals; however, frequent or business-like trading activity may be subject to taxation as business income under the country's general Income Tax laws. The practical environment for cryptocurrency is characterized by significant risks. Investors must exercise extreme caution due to the complete lack of regulatory oversight, which has made the jurisdiction a target for high-profile fraudulent schemes. Notably, dubious entities like the 'World Digital Central Bank' have historically targeted Kiribati, obtaining business registrations to lend a false veneer of legitimacy to their scams. Furthermore, the country's limited internet connectivity and banking infrastructure present substantial practical barriers to widespread and secure crypto adoption.
Summary Points
I. Regulatory Status
* Retail cryptocurrency trading is Allowed-Unregulated.
* Activity is legally permitted due to an absence of specific prohibitory laws.
* The sector operates in a regulatory gray area with no formal oversight framework.
II. Key Regulatory Bodies
* Ministry of Finance and Economic Development: Holds general financial oversight.
* Kiribati Police Service (Cybercrime Unit): Responsible for enforcement of cybercrime laws, which may apply to crypto-related offenses.
* No dedicated regulatory body or licensing authority for Virtual Asset Service Providers (VASPs) exists.
III. Important Legislation
* Cybercrime Act 2021 (Act No. 10 of 2021):
* Enacted on 2021-08-01.
* Primary legislation addressing computer-related offenses.
* While not crypto-specific, it criminalizes unauthorized access, data interference, and computer-related fraud, providing a legal basis to prosecute related cybercrimes.
IV. Compliance Requirements
* No specific VASP licensing or registration requirements.
* General business registration may apply to entities operating commercially.
* Taxation:
* No specific capital gains tax regime for digital assets.
* Frequent or business-like trading may be treated as taxable business income under general Income Tax laws.
V. Notable Restrictions or Limitations
* No consumer protection: Users have no formal recourse against exchange insolvency, fraud, or theft.
* High Scam Risk: The jurisdiction has been targeted by fraudulent 'sovereign' crypto schemes (e.g., World Digital Central Bank) that exploit the lack of regulation.
* Infrastructure Challenges: Limited internet connectivity and banking infrastructure significantly hamper practical adoption and secure trading.
VI. Recent Developments or Notes
* The 'World Digital Central Bank' entity mentioned in some contexts is widely regarded as a scam linked to convicted fraudsters and should not be confused with a legitimate Central Bank Digital Currency (CBDC) or regulatory body.
* The government has historically been vulnerable to endorsing or registering dubious crypto projects.
* Investors are advised to exercise extreme caution due to the complete lack of regulatory safeguards.
Full Analysis Report
Full Analysis Report
Kiribati maintains an 'Allowed-UnRegulated' stance towards cryptocurrency, primarily characterized by a legislative vacuum rather than a deliberate policy choice. There are no laws explicitly banning the buying, selling, or holding of digital assets, nor are there regulations governing the operation of exchanges. Consequently, retail investors are free to access international platforms, provided they can navigate the practical hurdles of internet connectivity and funding accounts from a jurisdiction with limited banking infrastructure. The Australian Dollar (AUD) is the official currency, meaning monetary policy is effectively outsourced, and local authorities have little incentive to defend a sovereign currency against crypto encroachment.
The regulatory environment is defined by what is absent rather than what is present. There is no licensing regime for Virtual Asset Service Providers (VASPs), meaning no entity is authorized to offer regulated crypto services within the country. The primary piece of relevant legislation is the Cybercrime Act 2021, which provides law enforcement with tools to combat digital fraud and unauthorized access but does not address the financial aspects of cryptocurrencies. The Kiribati Financial Intelligence Unit (FIU) has participated in regional forums regarding Anti-Money Laundering (AML) standards, but implementation of FATF Recommendation 15 (regarding virtual assets) remains nascent.
A critical aspect of the Kiribati context is its vulnerability to dubious 'sovereign' crypto projects. In recent years, entities such as the 'World Digital Central Bank' (WDCB) have claimed to be government-backed or authorized. Investigations have revealed these to be linked to foreign actors involved in fraud, who managed to secure standard business registrations or political photo-ops to feign legitimacy. These incidents highlight the risks of the unregulated environment, where official-sounding entities may lack genuine regulatory standing or oversight.
Practically, the lack of regulation means that while trading is legal, it is high-risk. There are no mechanisms for dispute resolution, and local banks may be hesitant to process transfers to crypto exchanges due to de-risking policies common in the Pacific region. Taxation remains largely theoretical for the average user; while general income tax provisions could technically apply to professional traders, there is no specific guidance from the Ministry of Finance, and enforcement capabilities regarding digital assets are likely limited.
Kiribati maintains an 'Allowed-UnRegulated' stance towards cryptocurrency, primarily characterized by a legislative vacuum rather than a deliberate policy choice. There are no laws explicitly banning the buying, selling, or holding of digital assets, nor are there regulations governing the operation of exchanges. Consequently, retail investors are free to access international platforms, provided they can navigate the practical hurdles of internet connectivity and funding accounts from a jurisdiction with limited banking infrastructure. The Australian Dollar (AUD) is the official currency, meaning monetary policy is effectively outsourced, and local authorities have little incentive to defend a sovereign currency against crypto encroachment. The regulatory environment is defined by what is absent rather than what is present. There is no licensing regime for Virtual Asset Service Providers (VASPs), meaning no entity is authorized to offer regulated crypto services within the country. The primary piece of relevant legislation is the Cybercrime Act 2021, which provides law enforcement with tools to combat digital fraud and unauthorized access but does not address the financial aspects of cryptocurrencies. The Kiribati Financial Intelligence Unit (FIU) has participated in regional forums regarding Anti-Money Laundering (AML) standards, but implementation of FATF Recommendation 15 (regarding virtual assets) remains nascent. A critical aspect of the Kiribati context is its vulnerability to dubious 'sovereign' crypto projects. In recent years, entities such as the 'World Digital Central Bank' (WDCB) have claimed to be government-backed or authorized. Investigations have revealed these to be linked to foreign actors involved in fraud, who managed to secure standard business registrations or political photo-ops to feign legitimacy. These incidents highlight the risks of the unregulated environment, where official-sounding entities may lack genuine regulatory standing or oversight. Practically, the lack of regulation means that while trading is legal, it is high-risk. There are no mechanisms for dispute resolution, and local banks may be hesitant to process transfers to crypto exchanges due to de-risking policies common in the Pacific region. Taxation remains largely theoretical for the average user; while general income tax provisions could technically apply to professional traders, there is no specific guidance from the Ministry of Finance, and enforcement capabilities regarding digital assets are likely limited.
Source Evidence
Primary and secondary sources cited in this analysis
"An Act to provide for the prevention, investigation and suppression of computer related offences."
"The Tarawa Tax Office... oversees the implementation and enforcement of tax laws... [No specific mention of crypto assets]"
"Jurisdictions continue to struggle with the implementation of the fundamental requirements of R.15 [Virtual Assets]."
"Cryptocurrency is not explicitly regulated or prohibited in Kiribati as of 2025, placing it in a legal gray area."
"They walked away having secured i-Kiribati financial licenses for four companies whose names hinted at greater ambitions: World Digital Central Bank..."
Web Sources (2)
Sources discovered via web search grounding
Search queries used (8)
- Kiribati cryptocurrency regulation status
- Kiribati Cybercrime Act cryptocurrency
- Kiribati central bank crypto warning
- Kiribati Financial Intelligence Unit cryptocurrency
- Kiribati APG Mutual Evaluation Report virtual assets
- Kiribati tax authority cryptocurrency
- Kiribati "World Digital Central Bank" scam
- Kiribati Ministry of Finance crypto warning
https://stablecoin.so/stablecoin-digital-asset-regulations-in-kiribati-compliance-overview-rwa-policies-template-mapping/
https://indepthsolomons.com.sb/chinese-miracle-water-grifters-infiltrated-the-un-and-bribed-politicians-to-build-pacific-dream-city/