Botswana

{
  "analysis_text": "Botswana has established itself as one of the few African jurisdictions with a comprehensive and active regulatory framework for cryptocurrencies. The turning point was the enactment of the **Virtual Assets Act, 2022**, which came into effect on February 25, 2022. This legislation moved the country from a \u0027buyer beware\u0027 environment to a formal \u0027Allowed-Regulated\u0027 status. The Act mandates that any entity offering virtual asset services to Botswana residents must obtain a license from the **Non-Bank Financial Institutions Regulatory Authority (NBFIRA)**. This effectively criminalized the operation of unlicensed exchanges after a transitional period that ended in May 2022.\n\nThe regulatory regime is operational, evidenced by the issuance of licenses. In September 2022, **Yellow Card Botswana (Pty) Ltd** became the first entity to receive a Virtual Asset Service Provider (VASP) license. As of late 2024, the NBFIRA public register lists multiple regulated entities, including Express Minds (Pty) Ltd and Kalahari Exchange (Pty) Ltd. This demonstrates that the framework is not merely theoretical but actively enforced and utilized by the private sector.\n\nThe **Bank of Botswana (BoB)**, while not the primary regulator for VASPs, plays a supporting role by monitoring financial stability. In its 2024 and 2025 financial stability reports, the BoB has acknowledged the Virtual Assets Act but continues to highlight potential risks related to AML/CFT and consumer protection. The central bank emphasizes that while trading is legal, virtual assets are not legal tender and do not enjoy the backing of the state.\n\nFrom a retail perspective, residents can freely access these licensed platforms to buy, sell, and hold digital assets. Compliance with **Financial Intelligence Agency (FIA)** standards is strict, requiring robust KYC/AML checks for all users. Taxation is another key consideration; the Botswana Unified Revenue Service (BURS) treats gains from crypto disposal as taxable events, typically falling under Capital Gains Tax rules, or Income Tax for frequent traders deemed to be running a business.",
  "confidence_level": "High",
  "executive_summary": "Retail cryptocurrency trading is explicitly legal and regulated in Botswana following the enactment of the Virtual Assets Act in February 2022. The Non-Bank Financial Institutions Regulatory Authority (NBFIRA) serves as the primary regulator and has actively issued licenses to Virtual Asset Service Providers (VASPs), with Yellow Card becoming the first licensee in late 2022. While the Bank of Botswana (central bank) remains cautious regarding financial stability risks, it acknowledges the legal framework, and retail investors can legally buy, sell, and hold digital assets through licensed entities.",
  "grounding_urls": [
    {
      "resolved_url": "https://www.nbfira.org.bw/news/licensing-virtual-assets-service-providers/",
      "title": "nbfira.org.bw",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQFLlmgzpc9XR3Mwy6frBQ4C5C7U4g6LcbT6W0IVeUov0LON1hAzY3bEiaoJq8u9I-bp8aQSETI8P9ibomcXKZu2FozMTB_GH0ur9S6a2rTjMKW-OQmHO7LazLv1_J16aYLhcmmPuCYH0PdC_UytSdU-L1JkmeDfSMni8n1nfeZC782C1pcD"
    },
    {
      "resolved_url": "https://dig.watch/updates/botswanas-central-bank-calls-for-crypto-regulations",
      "title": "dig.watch",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQFFKvQZiggGzx9iTS6GF-9wSoWjNj1nDwITYQn74Rxypwca6SbvTLm0gzaMBtFKO_VV0LbU9i8z34uhqzqNlp-kRtSeuhkSQW2JUMldsIXT2R5fw7-8BkDCyFrneK1UN0bhhjAXQezt_mBV6QhIgRnQDa5KMSpUkZrPuLpr9WLzxNtU4ziHLvJZ"
    },
    {
      "resolved_url": "https://www.wearetech.africa/en/fils-uk/news/economy/yellow-card-secures-virtual-asset-provider-license-in-botswana",
      "title": "wearetech.africa",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQHw62DzB55eqPpcY9XjRhxA8mkD61R9kXJ9k0Zgo_PCghfULi7PwmtW3Xsd_Jd-h1YcubCwE8gaRzFfyoU_9UMok18Wo4dSfJ2A04U0gYjqY6H9SYCtjxkVOqoL7hIgZj6gbRO_irwoidK9lt4rB8qkd6D39XNtmw66XUdqknVe9-0O6EXJIsWloIDjSYdYFfu6elKSFuq6WEbWjIpV6wk7rIpgKu4I6gaOZTqAS0g="
    },
    {
      "resolved_url": "https://www.nbfira.org.bw/list-of-regulated-entities/virtual-assets-service-provider-regulated-entities/",
      "title": "nbfira.org.bw",
      "url": "https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQH421g_X6i8Fs0U3Hu__tILYFUBJ6RjQw3uwmo-hF0VpLRIgieEDVhbwAn81M9yg3xdP1FaU0FZTbi2rLUwda4FsUZ7k7GrwrDJbL8MYlvm7YKZcWIf5Y38euUenYBVxS8V38M0gdOZ-Gvh6MWW4likqCZ23W0Xkkk52oTf_A9MJ9-qyDS8fDS2ucEu8Rwh1ZwP7Nd88u1OBaZhYqI7r36ktC1U"
    }
  ],
  "status": "Allowed-Regulated",
  "structured_data": {
    "confidence_level": "High",
    "detailed_analysis": "Botswana has established itself as one of the few African jurisdictions with a comprehensive and active regulatory framework for cryptocurrencies. The turning point was the enactment of the **Virtual Assets Act, 2022**, which came into effect on February 25, 2022. This legislation moved the country from a \u0027buyer beware\u0027 environment to a formal \u0027Allowed-Regulated\u0027 status. The Act mandates that any entity offering virtual asset services to Botswana residents must obtain a license from the **Non-Bank Financial Institutions Regulatory Authority (NBFIRA)**. This effectively criminalized the operation of unlicensed exchanges after a transitional period that ended in May 2022.\n\nThe regulatory regime is operational, evidenced by the issuance of licenses. In September 2022, **Yellow Card Botswana (Pty) Ltd** became the first entity to receive a Virtual Asset Service Provider (VASP) license. As of late 2024, the NBFIRA public register lists multiple regulated entities, including Express Minds (Pty) Ltd and Kalahari Exchange (Pty) Ltd. This demonstrates that the framework is not merely theoretical but actively enforced and utilized by the private sector.\n\nThe **Bank of Botswana (BoB)**, while not the primary regulator for VASPs, plays a supporting role by monitoring financial stability. In its 2024 and 2025 financial stability reports, the BoB has acknowledged the Virtual Assets Act but continues to highlight potential risks related to AML/CFT and consumer protection. The central bank emphasizes that while trading is legal, virtual assets are not legal tender and do not enjoy the backing of the state.\n\nFrom a retail perspective, residents can freely access these licensed platforms to buy, sell, and hold digital assets. Compliance with **Financial Intelligence Agency (FIA)** standards is strict, requiring robust KYC/AML checks for all users. Taxation is another key consideration; the Botswana Unified Revenue Service (BURS) treats gains from crypto disposal as taxable events, typically falling under Capital Gains Tax rules, or Income Tax for frequent traders deemed to be running a business.",
    "executive_summary": "Retail cryptocurrency trading is explicitly legal and regulated in Botswana following the enactment of the Virtual Assets Act in February 2022. The Non-Bank Financial Institutions Regulatory Authority (NBFIRA) serves as the primary regulator and has actively issued licenses to Virtual Asset Service Providers (VASPs), with Yellow Card becoming the first licensee in late 2022. While the Bank of Botswana (central bank) remains cautious regarding financial stability risks, it acknowledges the legal framework, and retail investors can legally buy, sell, and hold digital assets through licensed entities.",
    "important_considerations": [
      "**Licensing Requirement:** Operating a crypto exchange without an NBFIRA license is a criminal offense punishable by fines or imprisonment.",
      "**Taxation:** Cryptocurrency gains are subject to Capital Gains Tax (CGT). Professional traders may be liable for Income Tax on business profits.",
      "**Banking Access:** While no banking ban exists, banks are risk-averse; however, licensed entities (like Yellow Card) successfully offer local bank transfer and mobile money (e.g., MyZaka) integration.",
      "**Legal Tender:** Cryptocurrencies are not legal tender in Botswana; they are classified as \u0027virtual assets\u0027 used for investment or payment by mutual agreement."
    ],
    "key_regulatory_pillars": [
      "Non-Bank Financial Institutions Regulatory Authority (NBFIRA) - Primary regulator for VASPs",
      "Financial Intelligence Agency (FIA) - Oversight for AML/CFT compliance",
      "Bank of Botswana (BoB) - Monitors financial stability risks but does not directly license VASPs",
      "Virtual Asset Service Provider (VASP) Licensing - Mandatory for all entities offering crypto services to residents"
    ],
    "landmark_legislation": [
      {
        "date_enacted": "2022-02-25",
        "identifier": "Act No. 3 of 2022",
        "name": "Virtual Assets Act, 2022",
        "summary": "The foundational law regulating the sale and trade of virtual assets and licensing of VASPs. It prohibits unlicensed virtual asset businesses and establishes NBFIRA as the regulatory authority.",
        "url": "https://www.nbfira.org.bw/sites/default/files/Virtual%20Assets%20Act%202022.pdf"
      },
      {
        "date_enacted": "2022-02-25",
        "identifier": "S.I. No. 18 of 2022",
        "name": "Virtual Assets Regulations, 2022",
        "summary": "Subsidiary legislation detailing the application process, license fees, and operational requirements for VASPs.",
        "url": null
      },
      {
        "date_enacted": "2021-11-10",
        "identifier": "Press Release",
        "name": "Bank of Botswana Public Notice on Crypto Assets",
        "summary": "A warning issued prior to the Act, clarifying that crypto is not legal tender and investors trade at their own risk. While the Act now legalizes VASPs, the Central Bank maintains a stance that crypto is not guaranteed by the state.",
        "url": "https://www.bankofbotswana.bw/sites/default/files/press_release/PRESS%20RELEASE%20-%20CRYPTO%20ASSETS.pdf"
      }
    ],
    "notes_and_comments": "Botswana\u0027s removal from the FATF grey list was partly attributed to the swift enactment of the Virtual Assets Act, which closed gaps in AML/CFT oversight. This creates a strong incentive for the government to maintain strict regulatory enforcement.",
    "primary_sources": [
      {
        "date": "2022-02-25",
        "key_quote": "A person shall not carry out or participate in a virtual asset business unless the person is the holder of a virtual asset service provider licence.",
        "source_type": "law_text",
        "title": "Virtual Assets Act, 2022",
        "url": "https://www.nbfira.org.bw/sites/default/files/Virtual%20Assets%20Act%202022.pdf"
      },
      {
        "date": "2022-06-20",
        "key_quote": "All Virtual Asset Service Providers (VASPs) who have failed to apply for a license... are hereby called upon to immediately cease Virtual Asset operations.",
        "source_type": "regulator",
        "title": "NBFIRA Public Notice: Licensing of Virtual Assets Service Providers",
        "url": "https://www.nbfira.org.bw/licensing-virtual-assets-service-providers"
      },
      {
        "date": "2024-12-12",
        "key_quote": "Yellow Card Botswana (Pty) Ltd... Express Minds (Pty) Ltd... Kalahari Exchange (Pty) Ltd",
        "source_type": "regulator",
        "title": "NBFIRA Regulated Entities Search",
        "url": "https://www.nbfira.org.bw/regulated-entities"
      },
      {
        "date": "2024-10-01",
        "key_quote": "The Bank monitors developments in the virtual assets ecosystem... The Virtual Assets Act, 2022 provides for the regulation of the sale and trade of virtual assets.",
        "source_type": "official_government",
        "title": "Bank of Botswana Financial Stability Report",
        "url": "https://www.bankofbotswana.bw/sites/default/files/publications/FSR%20October%202024.pdf"
      }
    ],
    "remaining_uncertainties": [
      "Specific VAT treatment on crypto transaction fees (as opposed to the asset value itself) remains less clearly defined in public circulars.",
      "The extent of enforcement against international, unlicensed exchanges serving Botswana residents remotely is not fully documented in public enforcement reports."
    ],
    "secondary_sources": [
      {
        "date": "2022-10-24",
        "key_quote": "Yellow Card has made another significant stride in the industry, becoming the first cryptocurrency company on the continent to be granted a Virtual Asset Service Provider licence to operate in Botswana.",
        "source_type": "news",
        "title": "Yellow Card Receives First-Ever African Crypto Licence",
        "url": "https://yellowcard.io/blog/yellow-card-receives-first-ever-african-crypto-licence/"
      },
      {
        "date": "2024-01-01",
        "key_quote": "Botswana introduced a virtual assets bill... demonstrating a bold move towards recognizing crypto assets.",
        "source_type": "analysis",
        "title": "Freeman Law: Botswana Cryptocurrency \u0026 Blockchain Laws",
        "url": "https://freemanlaw.com/cryptocurrency/botswana/"
      }
    ],
    "status": "Allowed-Regulated"
  }
}