Algeria

Overall Status: Algeria has adopted a prohibitionist approach to virtual assets (VAs) rather than a regulatory one. Therefore, the FATF Travel Rule (Recommendation 16) is not implemented for Virtual Asset Service Providers (VASPs) within Algeria, as such entities are not permitted to operate.

Whether Adopted: No, the FATF Travel Rule has not been adopted for VASPs in Algeria because VASPs are not permitted to operate. Instead, Algeria has opted to prohibit virtual assets.

Effective Date of Prohibition: The prohibition on cryptocurrencies and their use stems from Law No. 18-05 of 2018 (Finance Law 2018), specifically Article 114, which came into effect on January 1, 2018.

Reference: While an official English translation with a direct URL from the Algerian government may be difficult to obtain, the prohibition is widely cited and confirmed by international bodies like the FATF.

Threshold Amounts: Not applicable. Since virtual asset activities and VASPs are prohibited, there are no regulated thresholds for information sharing under the Travel Rule.

Which VASPs are Covered: None are legally covered, as VASPs are not permitted to operate or be established in Algeria.

Technical Implementation Requirements: Not applicable. There are no technical requirements for Travel Rule implementation in Algeria due to the ban.

Penalties for Non-Compliance (i.e., for violating the ban):

Nature of Penalties: Individuals or entities engaged in virtual asset activities in violation of the law may face significant legal penalties, including fines and imprisonment, as these activities are considered illegal.

Specific Legislation: The penalties would fall under the broader framework of financial crimes and unauthorized financial operations as defined in Algerian law, primarily stemming from the directives of the Banque d'Algérie (Central Bank of Algeria) and the provisions of Law No. 18-05 of 2018.

FATF Mutual Evaluation Report Confirmation: The Financial Action Task Force (FATF) confirmed Algeria's stance in its Mutual Evaluation Report (MER). The MER noted that "Algeria has not authorized the operation of VASPs, nor the use or exchange of VAs in its territory." The report concluded that Algeria addresses the risks associated with VAs by prohibiting them.

"The purchase, sale, and use of so-called virtual currency are prohibited. Any violation of this provision is punishable in accordance with the laws and regulations in force."

Capital Gains Tax Rates on Crypto:

None. Since the purchase, sale, and use of virtual currency are prohibited, there are no legal grounds for capital gains to be recognized or taxed. Any gains derived from illegal activities would not be considered taxable income in the conventional sense but rather potential proceeds from a criminal act, subject to confiscation, fines, or other penalties under relevant financial crime legislation.

None. Similarly, income derived from activities involving virtual currencies (e.g., mining, trading, staking, or receiving crypto as payment for goods/services) is not recognized as legitimate income for tax purposes. Engaging in such activities is illegal and could lead to penalties rather than income tax obligations.

None. As all transactions involving virtual currencies are prohibited, they cannot be subject to Value Added Tax (VAT) or Goods and Services Tax (GST). VAT is applied to legal transactions of goods and services.

Reporting Requirements for Individuals and Businesses:

No specific crypto reporting requirements. Since engaging with cryptocurrency is illegal, there are no official reporting requirements for individuals or businesses regarding crypto holdings, transactions, or gains/losses.

Anti-Money Laundering (AML) / Counter-Terrorism Financing (CTF) Obligations: However, financial institutions (banks, payment service providers) in Algeria are subject to strict AML/CTF laws. If an individual or business attempts to convert funds suspected to be derived from illegal crypto activities into the traditional financial system, these attempts would be considered suspicious transactions and must be reported to the relevant authorities (e.g., Cellule de Traitement du Renseignement Financier - CTRF). This could trigger investigations and legal consequences for engaging in prohibited activities.

None. Algeria has no specific tax legislation for cryptocurrency because its primary legal framework is one of prohibition, not regulation and taxation.

Loi de Finances n° 18-13 du 29 Dhou El Hidja 1439 correspondant au 9 septembre 2018 portant loi de finances pour 2019 (Finance Law 2019, which contains Article 117 regarding virtual currencies):

While the law is officially published in the Journal Officiel de la République Algérienne Démocratique et Populaire (Official Gazette of the People's Democratic Republic of Algeria), direct links to specific articles can be challenging to find in an easily accessible online format in English. However, legal databases and governmental archives would hold this. The key reference is Article 117 of Law No. 18-13 of September 9, 2018.

General DGI Website (for broader tax information, though not crypto-specific): http://www.mfdgi.gov.dz/ (French/Arabic)

Banque d'Algérie (Bank of Algeria) Communiqués:

The Central Bank of Algeria has issued warnings and communiqués reinforcing the prohibition on cryptocurrency. While these are not tax-specific, they reiterate the illegal nature of virtual currencies.

Banque d'Algérie Official Website: https://www.bank-of-algeria.dz/ (French/Arabic). You would typically look for "Communiqués" or "Avis" sections for official statements.

Loi de Finances pour 2018 (Finance Law for 2018)

Reference: Article 117 of the Loi n° 17-11 du 27 Rabie Ethani 1439 correspondant au 15 janvier 2018 portant Loi de Finances pour 2018.

Implication for Stablecoins: As stablecoins are a form of "virtual currency," they fall under this blanket prohibition. There is no distinction made for their pegging mechanism.

URL (Official Algerian Journal): While a direct link to a single article within the JORADP is difficult to provide, the full Finance Law 2018 can typically be found in the Journal Officiel de la République Algérienne Démocratique et Populaire (JORADP) - N° 03 du 17 janvier 2018.

General JORADP Archives (in French) (You would need to navigate to the correct year/issue). Reputable legal databases often host it as well.

Loi n° 23-07 du 21 Dhou El Hidja 1444 correspondant au 9 juillet 2023 relative à la monnaie et au crédit (Law No. 23-07 of July 9, 2023, on Money and Credit)

Reference: Article 138 of the new Money and Credit Law.

Content: This new comprehensive law, which replaced the previous Money and Credit Law of 2003, reaffirms the prohibition of cryptocurrencies. Article 138 states:

Significance: This update solidifies the ban, leaving no ambiguity, and importantly, includes "any other digital asset" not issued or authorized by the Central Bank, which certainly encompasses stablecoins.

URL (Official Algerian Journal): Journal Officiel de la République Algérienne Démocratique et Populaire N° 50 du 23 juillet 2023.

JORADP N° 50 du 23 juillet 2023 (in French) (See page 14 for Article 138).

Stablecoins are not formally classified into these categories for permitted use. Instead, they fall under the broad definition of "virtual currency" or "any other digital asset not issued or guaranteed by the Bank of Algeria" and are therefore prohibited.

Algeria has an e-money framework for traditional electronic money issued by licensed financial institutions (banks, payment institutions) under the oversight of the Banque d'Algérie. However, stablecoins, particularly those not issued by an Algerian-licensed entity within the regulated payment system, would not fit this framework and would be caught by the general crypto ban.

None. Since stablecoins are prohibited, there are no legal requirements for reserves for issuers in Algeria.

None. As stablecoin issuance is prohibited, there is no licensing framework for stablecoin issuers. Entities attempting to issue stablecoins within Algeria would be acting illegally.

None. Given the prohibition on their use and possession, there are no established legal rights for redemption of stablecoins in Algeria. Users would have no legal recourse within the Algerian financial system.

None. There are no specific rules for algorithmic stablecoins, as all forms of virtual currencies are prohibited.

Exploration: The Banque d'Algérie has indicated its interest in studying and potentially developing a CBDC. This is often seen as a way for central banks to modernize their financial infrastructure while maintaining control over monetary policy and preventing the use of unregulated private digital currencies.

Implication for Stablecoins: Should a Digital Dinar be introduced, it would likely be positioned as the only legitimate digital currency, further solidifying the ban on private stablecoins and other cryptocurrencies. The new Money and Credit Law (Article 138) already draws a clear distinction, prohibiting digital assets "not issued or guaranteed by the Bank of Algeria or authorized by it," implicitly creating space for a future CBDC while maintaining the ban on others.

Regulatory Reference: The new Law on Money and Credit (Loi n° 23-07 du 9 juillet 2023) also empowers the Banque d'Algérie to issue digital currencies. Article 12 explicitly includes "digital banknotes and coins" among the forms of legal tender.

URL: JORADP N° 50 du 23 juillet 2023 (in French) (See page 5 for Article 12).

News References (for CBDC exploration):

Bank Al Maghrib (Morocco) and Bank of Algeria (Algeria) Consider CBDC, BIS Says (Bitcoin.com) (News article mentioning Algeria's interest).