Stablecoin issuer / redeemer in Grenada
Issues a fiat-pegged stablecoin to the public, operates redemption, and holds reserves backing the float.
Stablecoin issuer is conditionally permitted in Grenada with a local entity, subject to AML obligations and high licensing burden.
Verdict Details
- Permitted
- conditional
- Local entity required
- Yes
- Licensing burden
- High
- Last updated
- 2026-07-13
AML Obligations
- Registration/notification with the FIU as a reporting entity (VASP).
- Implement a comprehensive AML/CFT program including Customer Due Diligence (CDD) and Enhanced Due Diligence (EDD) for high-risk customers.
- Monitor transactions for suspicious activities.
- File Suspicious Transaction Reports (STRs) to the FIU.
- Appoint a designated AML/CFT Compliance Officer.
- Maintain record-keeping of transactions and customer identification data.
- Conduct ongoing staff training on AML/CFT.
- Implement risk assessment frameworks.
- Comply with Proceeds of Crime Act, Cap. 254 and Terrorism Act, Cap. 317.
Key Restrictions
- Must be a company incorporated or established in Grenada (local entity required).
- Must have directors or senior officers ordinarily resident in Grenada, or alternative arrangements satisfactory to the FSA.
- Must maintain sufficient capital — specific minimum capital requirements to be prescribed by the FSA (amounts unclear; consult FSA directly).
- Must pass a fit-and-proper test for directors and senior officers.
- Stablecoin issuance likely falls under 'provision of virtual asset payment services' and/or 'participation in and provision of financial services related to an issuer's offer and/or sale of a virtual asset' — a VASP license under the Virtual Asset Business Act is required.
- There is no specific e-money or banking license regime tailored to stablecoin issuers — the VASP license framework is the applicable regulatory path.
- Reserve composition, segregation, and audit rules are not explicitly codified in current Grenadian VASP regulation; this creates regulatory ambiguity.
Key Risks
- No explicit mandate in Grenadian VASP regulation for reserve segregation, composition requirements, or independent audits specific to stablecoin reserves — creates prudential risk and regulatory uncertainty.
- No explicit requirement for custodial insurance or bonding under current AML/CFT framework.
- There is ambiguity about whether foreign-issued stablecoins (e.g., USDC, USDT) are permitted for local use — no clear regulatory pronouncement found.
- Redemption rights for stablecoin holders are not addressed in existing VASP legislation or AML guidance.
- Tax risk: stablecoin issuance/redemption as a business activity would be subject to corporate income tax at 28% and VAT on related services — careful structuring required.
- Thin granularity of local regulations specific to stablecoin issuance means high reliance on FSA/FIU guidance and discretion.
Evidence
This verdict synthesizes the following facts. Each fact links to its primary source(s).
Grenada Financial Services Authority (FSA): The competent authority responsible for licensing, supervision, and enforcement of the Virtual Asset Business Act.
Grenada Financial Intelligence Unit (FIU): Responsible for anti-money laundering and combating the financing of terrorism (AML/CFT) supervision of virtual asset businesses.
Exchange between virtual assets and fiat currencies.
Provision of virtual asset payment services.
Participation in and provision of financial services related to an issuer’s offer and/or sale of a virtual asset.
Virtual asset businesses are designated as "reporting entities" under Grenada's Proceeds of Crime Act and other AML/CFT legislation.
Licensees must establish and implement robust AML/CFT systems and controls, including:
An applicant must be a company incorporated or established in Grenada. This requires a legal entity registered within the jurisdiction.
Fit and Proper Test:
The Act mandates that a licensee must, at all times, maintain sufficient capital to carry on its virtual asset business.
The specific minimum capital requirements are to be prescribed by the Authority (FSA) through regulations or directives. Applicants should consult the FSA directly or its published guidelines for the exact amounts, which may vary depending on the scope of activities.
VASP Definition: The FIU's guidance defines a VASP consistent with FATF recommendations, which includes any natural or legal person who, as a business, conducts one or more of the following activities for or on behalf of another natural or legal person:
Registration/Notification: VASPs are generally required to register with the FIU and/or notify the FIU of their operations, ensuring compliance with AML/CFT obligations. This is not a specific "license" but a requirement to operate legally under the AML/CFT regime.
AML/CFT Program: VASPs must implement a comprehensive AML/CFT program, including:
Proceeds of Crime Act, Cap. 254: This act defines money laundering offenses and establishes the framework for combating financial crime.
Terrorism Act, Cap. 317: Addresses financing of terrorism.
Guidance for Virtual Asset Service Providers (VASPs): The FIU has issued guidance notes to clarify the application of AML/CFT requirements to VASPs, in line with Financial Action Task Force (FATF) recommendations. This guidance is the most relevant document for crypto businesses.
Not explicitly detailed in VASP AML/CFT Guidance: While general AML/CFT guidance focuses on identifying clients, monitoring transactions, and reporting, it typically does not go into the specifics of prudential requirements like asset segregation.
No explicit mandate: Grenada's current AML/CFT framework for VASPs does not explicitly require custodians to carry specific insurance or bonding to cover potential losses of client digital assets.
Companies legally registered in Grenada and engaged in crypto-related activities (e.g., operating an exchange, a mining farm, a blockchain development firm) will have their net profits taxed at the corporate income tax rate.
Rate: The standard corporate income tax rate in Grenada is 28%.
Services Related to Cryptocurrency:
Verdict Attribution
- Source:
- AI-Generated · Unreviewed
- AI synthesized:
- 2026-07-13 (deepseek-chat)
- Last updated:
- 2026-07-13
- Confidence:
- low
This verdict was produced by an AI model from the underlying facts. Confirm with counsel before relying on it for material decisions.
Conditional — a stablecoin issuer may operate in Grenada by obtaining a VASP license under the Virtual Asset Business Act (no specific e-money or banking license exists), incorporating locally, maintaining sufficient capital per FSA directives, and complying with the AML/CFT regime, but reserve composition, segregation, audit, and redemption rights are not explicitly codified, creating significant regulatory ambiguity.
Questions this verdict aims to answer
- What e-money or banking license is required to issue?
- What reserve composition, segregation, and audit rules apply?
- What redemption rights must be granted to holders?
- Are foreign-issued stablecoins permitted for use locally?