Cook Islands

**Report on the Retail Trading Status of Cryptocurrencies in the Cook Islands**

**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.

**1. Identified Status**
Allowed-UnRegulated

**2. Detailed Narrative Explanation**
The status of retail cryptocurrency trading in the Cook Islands is 'Allowed-UnRegulated.' There is no legal prohibition on individuals buying, selling, or holding cryptocurrencies. However, the activity is not subject to a specific regulatory framework for consumer protection or platform licensing. The primary regulator, the Financial Supervisory Commission (FSC), acknowledges that the existing 'Money-Changing and Remittance Businesses Act 2009' is outdated and that crypto-asset transfers operate in a 'gray area' due to this lack of formal coverage. The FSC has proposed a 'Draft Money & Payment Services Policy' to introduce licensing for such services, but it remains in consultation and is not enacted. Therefore, no entity can currently obtain a license to operate a cryptocurrency exchange or brokerage for retail consumers in the Cook Islands. The FSC actively warns the public against entities falsely claiming to be licensed by them, indicating that while trading is allowed, it occurs in an unregulated environment with associated risks. General AML/CFT laws under the Financial Transactions Reporting Act 2017 apply to financial transactions broadly, but their enforcement for crypto-specific businesses is ambiguous without a licensing structure. The controversial 'Tainted Cryptocurrency Recovery Bill 2023,' which targeted illicit crypto assets, was withdrawn in late 2024, further indicating the absence of enacted legislation governing the retail crypto market. Consequently, individuals can engage with cryptocurrencies, but they do so without the safeguards of a dedicated regulatory regime.

**3. Specific, Relevant Text Excerpts**
*   **FSC Draft Policy:** "As a result, fintech solutions like mobile money, online remittance apps, and crypto-asset-based transfers operate in a gray area or not at all." (Draft Money & Payment Services Policy, 2024-09-16)
*   **FSC Public Warning:** "Crypto Coin Vent has never been licensed or regulated by the Cook Islands Financial Supervisory Commission, nor has it ever applied to be." (FSC Public Notice, 2021-05-12)
*   **Withdrawal of Crypto Bill:** "Cook Islands Government has withdrawn the Tainted Cryptocurrency Recovery Bill 2023 following widespread criticism." (Cook Islands News, 2024-12-03)
*   **Tainted Cryptocurrency Recovery Bill Focus:** "The Bill aims to combat money laundering, financing of terrorism, financing of proliferation of weapons of mass destruction. The Bill focuses on the detection, investigation, seizure and forfeiture of cryptocurrency that is or represents the proceeds of proscribed conduct..." (Cook Islands News, December 13, 2023)
*   **AML Framework:** "An Act to help combat financial misconduct and the commission of serious offences by monitoring certain transactions." (Financial Transactions Reporting Act 2017)

**4. Direct, Accessible URL Links to Sources**
*   Financial Supervisory Commission - Public Notices: https://www.fsc.gov.ck/public-notices/
*   Draft Money & Payment Services Policy: https://www.fsc.gov.ck/cookIslandsFsc/consultation/Draft%20Money%20&%20Payment%20Services%20Policy.pdf
*   Financial Transactions Reporting Act 2017: https://www.fsc.gov.ck/cookIslandsFsc/legislation/Financial%20Transactions%20Reporting%20Act%202017.pdf
*   Cook Islands News - Cook Islands to crack down on crypto with new Recovery Bill (December 13, 2023): https://www.cookislandsnews.com/internal/national/parliament/cook-islands-to-crack-down-on-crypto-with-new-recovery-bill/
*   Cook Islands News - Government withdraws controversial Cryptocurrency Bill (December 3, 2024): https://www.cookislandsnews.com/internal/national/cook-islands-government-withdraws-controversial-cryptocurrency-bill-for-redrafting/