Stablecoin issuer / redeemer in Cabo Verde

No Explicit Classification: There is no specific law classifying stablecoins as e-money, payment tokens, or securities.

Potential E-money Classification by Analogy: If a stablecoin is pegged to the Cabo Verde Escudo (CVE) or another fiat currency, is issued against receipt of funds, and is accepted as a means of payment by parties other than the issuer, it could potentially be categorized as "electronic money" under existing legislation.

Legal Reference: Lei n.º 137/VIII/2015, de 31 de Dezembro (Regime Jurídico das Instituições de Moeda Electrónica) – This law establishes the legal framework for Electronic Money Institutions (EMIs).

If classified as E-money: Institutions issuing e-money under Lei n.º 137/VIII/2015 are subject to strict reserve requirements. They must safeguard funds received in exchange for electronic money by holding them in a separate account in a credit institution or investing them in secure, low-risk assets.

Specific prudential requirements, including initial capital and ongoing capital requirements, would also apply.

If classified as E-money: Any entity intending to issue stablecoins that are deemed electronic money would need to obtain a license as an Electronic Money Institution (EMI) from the Banco de Cabo Verde (BCV). This involves meeting stringent capital, governance, operational, and anti-money laundering requirements.

If not classified as E-money: Without specific stablecoin legislation, there are no explicit reserve requirements solely for stablecoins that are not deemed e-money. However, operating without proper classification and compliance would be highly risky and likely illegal if it constitutes unauthorized financial activity.

If classified as E-money: Lei n.º 137/VIII/2015 explicitly grants e-money holders the right to redeem their electronic money at par value at any time, free of charge, unless specific conditions for fees are met (e.g., redemption before the termination of a contract). The issuer must make the funds available promptly.

If not classified as E-money: Without specific stablecoin legislation, there are no explicit reserve requirements solely for stablecoins that are not deemed e-money. However, operating without proper classification and compliance would be highly risky and likely illegal if it constitutes unauthorized financial activity.

Banco de Cabo Verde (BCV) Stance:

It has clarified that cryptocurrencies are not legal tender in Cabo Verde.

The BCV has stated it does not authorize, supervise, or license entities that deal exclusively with virtual assets, but it has actively issued public warnings and interventions (e.g., regarding OPTCOIN), indicating some regulatory oversight through public communications and evolving legal frameworks for digital currency.

Lack of Dedicated Licensing Regime:

There are no specific laws or regulations that define a licensing framework for crypto exchanges, custody providers, or payment processors as distinct categories of financial institutions.

Neither a specific licensing nor a dedicated registration regime for Virtual Asset Service Providers (VASPs) exists in Cabo Verde.

If a company were to deal with fiat currency in a way that constitutes a traditional financial service (e.g., remittances, payment processing of traditional money), then those specific activities would fall under the BCV's existing licensing requirements for financial institutions, which are separate from crypto activities.

Lei n.º 1/IX/2021, de 16 de março (AML/CFT Law): You would typically find this on the official gazette (Boletim Oficial) of Cabo Verde or through legal databases. A direct public URL from the government might be specific to a legislative portal. You can search for "Lei n.º 1/IX/2021 Cabo Verde branqueamento de capitais" to find official publications.

Customer Due Diligence (CDD/KYC): Implementing robust KYC procedures to identify and verify the identity of customers, including beneficial owners. This means collecting name, address, date of birth, national ID, etc.

Enhanced Due Diligence (EDD): For higher-risk customers or transactions.

Record-Keeping: Maintaining records of customer identification data and transaction details for a specified period (typically 5-7 years).

Suspicious Transaction Reporting (STR): Reporting any suspicious transactions or activities to the UIF without delay.

Risk Assessments: Conducting a thorough assessment of money laundering and terrorist financing risks associated with their business operations, customers, products, and services.

Internal Controls: Establishing and maintaining appropriate internal policies, procedures, and controls to mitigate ML/TF risks, including the appointment of an AML compliance officer and staff training.

No specific "crypto custody license" currently exists.

However, any entity providing services that involve holding or managing financial assets, even digital ones, could potentially be deemed to be operating within the scope of existing financial services laws and regulations. This might necessitate obtaining a general financial services license or authorization from the Banco de Cabo Verde (BCV) if their activities are interpreted to fall under the definition of banking, investment services, or payment services.

Segregation of Client Assets Rules:

Law No. 10/VIII/2011, of 23 May: This is the foundational law on the Prevention and Combat of Money Laundering, Financing of Terrorism and Proliferation of Weapons of Mass Destruction. It establishes the general framework for AML/CFT obligations, including customer due diligence, suspicious transaction reporting, and record-keeping.

Identification and Verification:

Ongoing Monitoring: Continuously monitor the business relationship and transactions to ensure they are consistent with the VASP's knowledge of the customer, their business, and risk profile. This includes reviewing customer records and updating information as needed.

Enhanced Due Diligence (EDD): Required for higher-risk customers or transactions, including:

Reporting Obligation: Immediately report any transaction (or attempted transaction), regardless of the amount, that the VASP suspects to be related to money laundering, terrorist financing, or proliferation financing.

Retention Period: Records must be retained for at least five (5) years after the business relationship ends or after the date of an occasional transaction. These records must be readily available to competent authorities upon request.

Unidade de Informação Financeira (UIF) – Financial Intelligence Unit: