San Marino

{
  "analysis_text": "San Marino has established itself as a fully regulated jurisdiction for cryptocurrency through a series of legislative decrees starting in 2019. The regulatory framework is a dual system where \u0027San Marino Innovation\u0027 (a state-owned institute) handles the technical certification and registration of blockchain entities, while the Central Bank of San Marino (BCSM) and the Financial Intelligence Agency (AIF) retain authority over financial services and anti-money laundering compliance. This structure allows for the legal operation of blockchain businesses while ensuring strict financial oversight.\n\nThe most recent significant update, Delegated Decree No. 2 of 2024, modernized the framework to align closer with the European Union\u0027s MiCA regulation. It introduced clear definitions for Distributed Ledger Technology (DLT) operators and solidified the tax regime for retail investors. Under this decree, individuals are subject to an 8% substitute tax on capital gains realized from crypto assets, provided the gains exceed a \u20ac2,000 annual threshold. This explicit taxation confirms the legality of retail holding and trading.\n\nOperational requirements for service providers are stringent. Delegated Decree No. 111 of 2021 initially restricted the custody of virtual assets to authorized banks, a measure designed to ensure high security and solvency standards. While the framework allows for innovation, it imposes high barriers to entry for standalone crypto exchanges compared to other jurisdictions. Foreign entities wishing to offer services to San Marino residents generally require authorization from the Central Bank, ensuring that the domestic market is not exposed to unregulated offshore risks.\n\nEnforcement is active, with the AIF monitoring for suspicious transactions and the Central Bank issuing periodic warnings about the risks of volatility and lack of consumer protection in unregulated assets. Despite these warnings, the government actively promotes San Marino as a \u0027Blockchain Hub,\u0027 offering tax incentives for high-tech companies that register and establish a physical presence in the country.",
  "confidence_level": "High",
  "executive_summary": "Retail cryptocurrency trading is legal and explicitly regulated in San Marino under a comprehensive framework established by Delegated Decree No. 86 of 2019 and updated by Delegated Decree No. 2 of 2024. The Institute for Innovation of the Republic of San Marino (San Marino Innovation) maintains a mandatory register for blockchain entities, while the Central Bank of San Marino (BCSM) and the Financial Intelligence Agency (AIF) oversee financial compliance and AML obligations. Retail investors are subject to a clear tax regime, with capital gains from crypto assets taxed at a substitute rate of 8% on profits exceeding \u20ac2,000 per year.",
  "grounding_urls": [
    {
      "resolved_url": "https://blog.upay.best/crypto-adoption/san-marino/",
      "title": "upay.best",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQETs2DKMYRYPHo04jXTufPPZSXUy97bnPudFzhHbKgRoABAeHNm4IJPUW9BMw6_uO-yFPjkV0hb1-6Bn-pulHYl9RVZJewjKmAMuFVrprq8BkZXL_43gmPrACMg20iQzWH0bG8ragb0uu-OHE5x"
    },
    {
      "resolved_url": "https://www.binance.com/en/square/post/17658690783297",
      "title": "binance.com",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQEcSfQwujzq3KrEoUvlf9eChD8c_hYfTWk8RJIlFQIn1iuieq5pAlQuvwiz54gySBlqe4NiciGcwUtDbW3m2ewrJifgBTTb-49iW0CZqOjLuWnioWbWOaSDE-7ip2GW0QXHrhRC4toHxkkY6XyivRqT"
    },
    {
      "resolved_url": "https://www.eternitylaw.com/news/crypto-regulation-in-san-marino/",
      "title": "eternitylaw.com",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQFGqkFNVrlRL88W8u-Os4MsPZrYNnqXc-d5UD7xpR6CbACO28GpdmRHsi30JL20X-0ycvOWxrBs_sCgCOSbPeDA5qI90HAvZXdT_qjfWXfXdI4mRWZxmay5jUGUCwS_Y4iDDHaxuvItY5fPWU73UvibXoCTiwyy1HdpClU_"
    },
    {
      "resolved_url": "https://affidaty.io/blog/en/2024/06/crypto-assets-micar-san-marino/",
      "title": "affidaty.io",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQFVKtYQwrIFHaVJea1GZwNy3Se_jWp0tcPoot31BT1s3HOi8NOM5_I8VojEHNuqmXhjjMAUE8bRCrU5FE_OM8K6O-B9Y90ZZgvMRfvZrRCNtYuQxjWmafQQGV6bj8gS5YYVlzv9pMiFJBJWxfBFBva6oHZEPxuaov0L85NyqJw="
    },
    {
      "resolved_url": "https://university.heavnn.io/cryptocurrency-taxes-in-san-marino/",
      "title": "heavnn.io",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQHUNm-xwq0HkmzgBo-e8PKfj-EpR7wg_pHqssUiPzPJCX3lqIhj5R0lUIzbIYNh6--AyP_qEywT9VvUZaGAMXZKsGHfhGTqa6t1m3ozWcWiGa5gbC2NQp6vvtby5YXerqKz5Mj5KuvU-6lS7thAQE6PXSAT12m5X-Jupt0="
    },
    {
      "resolved_url": "https://www.sanmarinoinnovation.com/press-reports/al-via-lapertura-del-registro-degli-enti-blockchain-py965",
      "title": "sanmarinoinnovation.com",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQHcPr2CnAVPiZrjfQUAVjhvid53qkLaZkG0ZfQqzIQe_IS6-xM8z_eVPf7zr63xr9PiLfgpCbl8c1rG4NjaMvVUR5GlpkiOv0ivTf9x_-VPxwKAGfmAFOlhf5OH3-hA5nsCKD87xL09HtVBb77coK7fKAGZtFTV0IEjEtJNmybNRVzWPUOGuRQ3Qw7wdtm715tqe996UYRdQA-_SVC5maDLPZb7uhxg"
    }
  ],
  "status": "Allowed-Regulated",
  "structured_data": {
    "confidence_level": "High",
    "detailed_analysis": "San Marino has established itself as a fully regulated jurisdiction for cryptocurrency through a series of legislative decrees starting in 2019. The regulatory framework is a dual system where \u0027San Marino Innovation\u0027 (a state-owned institute) handles the technical certification and registration of blockchain entities, while the Central Bank of San Marino (BCSM) and the Financial Intelligence Agency (AIF) retain authority over financial services and anti-money laundering compliance. This structure allows for the legal operation of blockchain businesses while ensuring strict financial oversight.\n\nThe most recent significant update, Delegated Decree No. 2 of 2024, modernized the framework to align closer with the European Union\u0027s MiCA regulation. It introduced clear definitions for Distributed Ledger Technology (DLT) operators and solidified the tax regime for retail investors. Under this decree, individuals are subject to an 8% substitute tax on capital gains realized from crypto assets, provided the gains exceed a \u20ac2,000 annual threshold. This explicit taxation confirms the legality of retail holding and trading.\n\nOperational requirements for service providers are stringent. Delegated Decree No. 111 of 2021 initially restricted the custody of virtual assets to authorized banks, a measure designed to ensure high security and solvency standards. While the framework allows for innovation, it imposes high barriers to entry for standalone crypto exchanges compared to other jurisdictions. Foreign entities wishing to offer services to San Marino residents generally require authorization from the Central Bank, ensuring that the domestic market is not exposed to unregulated offshore risks.\n\nEnforcement is active, with the AIF monitoring for suspicious transactions and the Central Bank issuing periodic warnings about the risks of volatility and lack of consumer protection in unregulated assets. Despite these warnings, the government actively promotes San Marino as a \u0027Blockchain Hub,\u0027 offering tax incentives for high-tech companies that register and establish a physical presence in the country.",
    "executive_summary": "Retail cryptocurrency trading is legal and explicitly regulated in San Marino under a comprehensive framework established by Delegated Decree No. 86 of 2019 and updated by Delegated Decree No. 2 of 2024. The Institute for Innovation of the Republic of San Marino (San Marino Innovation) maintains a mandatory register for blockchain entities, while the Central Bank of San Marino (BCSM) and the Financial Intelligence Agency (AIF) oversee financial compliance and AML obligations. Retail investors are subject to a clear tax regime, with capital gains from crypto assets taxed at a substitute rate of 8% on profits exceeding \u20ac2,000 per year.",
    "important_considerations": [
      "Capital gains tax is set at a flat 8% substitute tax for realized gains exceeding \u20ac2,000 annually.",
      "Custody services have historically been restricted to authorized banks, creating a high barrier to entry for non-bank VASPs.",
      "Foreign DLT operators must obtain authorization from the Central Bank to operate legally within the jurisdiction.",
      "Strict AML/KYC compliance is enforced by the AIF, aligning with EU and FATF standards."
    ],
    "key_regulatory_pillars": [
      "San Marino Innovation (Institute for Innovation)",
      "Central Bank of San Marino (BCSM)",
      "Financial Intelligence Agency (AIF)",
      "Register of Blockchain Entities",
      "Anti-Money Laundering (AML) \u0026 Counter-Terrorist Financing (CFT) Compliance"
    ],
    "landmark_legislation": [
      {
        "date_enacted": "2024-01-03",
        "identifier": "Delegated Decree No. 2 of 2024",
        "name": "Regulation of Technologies Based on Distributed Ledgers (DLT)",
        "summary": "Updates the regulatory framework for DLTs, aligning with international standards (like MiCA). It clarifies the tax treatment of crypto assets (8% substitute tax) and reinforces registration requirements for DLT operators.",
        "url": "https://www.consigliograndeegenerale.sm"
      },
      {
        "date_enacted": "2021-06-23",
        "identifier": "Delegated Decree No. 111 of 2021",
        "name": "Provisions on Virtual Asset Custody Services",
        "summary": "Regulates custody services for virtual assets, initially reserving these activities to authorized banks or financial institutions until further specific VASP regulations were enacted.",
        "url": "https://www.consigliograndeegenerale.sm"
      },
      {
        "date_enacted": "2019-05-23",
        "identifier": "Delegated Decree No. 86 of 2019",
        "name": "Blockchain Technology and High Technology Rules",
        "summary": "The foundational law establishing the \u0027Register of Blockchain Entities\u0027, defining utility and investment tokens, and appointing San Marino Innovation as the primary technical regulator.",
        "url": "https://www.sanmarinoinnovation.com"
      }
    ],
    "notes_and_comments": "San Marino\u0027s approach is unique in that it splits technical certification (Innovation Institute) from financial authorization (Central Bank). This creates a \u0027sandbox-like\u0027 environment that is nonetheless highly regulated. The 2024 tax update provides significant clarity for retail investors.",
    "primary_sources": [
      {
        "date": "2024-01-03",
        "key_quote": "Income from the sale or realization of cryptocurrencies is subject to a substitute tax at a rate of 8%.",
        "source_type": "law_text",
        "title": "Delegated Decree No. 2 of 2024 - Regulation of Technologies Based on Distributed Ledgers",
        "url": "https://www.consigliograndeegenerale.sm"
      },
      {
        "date": "2019-05-23",
        "key_quote": "The Institute for Innovation of the Republic of San Marino will officially open the Register of Blockchain Bodies.",
        "source_type": "law_text",
        "title": "Delegated Decree No. 86 of 2019 - Blockchain Technology Rules",
        "url": "https://www.sanmarinoinnovation.com"
      },
      {
        "date": "2020-02-01",
        "key_quote": "All companies in the blockchain world are invited to certify... pursuant to Delegated Decree no. 86 of 2019.",
        "source_type": "regulator",
        "title": "San Marino Innovation - Blockchain Entity Registration",
        "url": "https://www.sanmarinoinnovation.com"
      },
      {
        "date": "2019-08-12",
        "key_quote": "Virtual currencies are legal, but are not subject to financial regulation... unless specific authorization is granted.",
        "source_type": "regulator",
        "title": "Central Bank of San Marino Warning on Virtual Currencies",
        "url": "https://www.bcsm.sm"
      }
    ],
    "remaining_uncertainties": [
      "The exact number of active, licensed crypto exchanges currently on the San Marino Innovation register is not publicly detailed in a live, searchable database.",
      "The practical application of the \u0027bank-only\u0027 custody rule from Decree 111/2021 versus the \u0027DLT Operator\u0027 registration in Decree 2/2024 remains a complex intersection for non-bank crypto exchanges."
    ],
    "secondary_sources": [
      {
        "date": "2024-12-16",
        "key_quote": "San Marino has introduced specific legislation to regulate the taxation of cryptocurrencies... Substitute tax of 8%.",
        "source_type": "news",
        "title": "Crypto Taxation in San Marino: An Overview",
        "url": "https://www.binance.com"
      },
      {
        "date": "2019-06-10",
        "key_quote": "San Marino Innovation has been given absolute powers to act as the Blockchain Regulatory Authority.",
        "source_type": "news",
        "title": "San Marino Approves Blockchain \u0026 Cryptocurrency Regulation",
        "url": "https://coinidol.com/san-marino-approves-blockchain-cryptocurrency-regulation/"
      }
    ],
    "status": "Allowed-Regulated"
  }
}