Jordan

Exchanging between virtual assets and fiat currencies.

Exchanging between one or more forms of virtual assets.

Safekeeping and/or administration of virtual assets or instruments enabling control over virtual assets.

Participation in and provision of financial services related to an issuer's offer and/or sale of a virtual asset.

**Collect required information:** Obtain and hold accurate and meaningful originator information and required beneficiary information for virtual asset transfers.

**Transmit required information:** Submit the required originator and beneficiary information to the beneficiary VASP (or to the originator VASP in the case of a receipt).

**Verify information:** Conduct verification of customer identity as part of their Customer Due Diligence (CDD) process.

**Record-keeping:** Maintain records of all transaction information and CDD data for a specified period (typically 5-10 years).

**Monitor and report:** Implement systems for ongoing monitoring of transactions and reporting of suspicious transactions (STRs) to Jordan's Anti-Money Laundering and Counter-Terrorist Financing Unit (AMLCFTU).

**Interoperability:** While the Circular doesn't specify particular technical solutions (like TRISA, Sygna, Travel Rule Protocol), VASPs are expected to adopt solutions that enable secure, reliable, and compliant transmission and receipt of required Travel Rule data.

**Administrative Sanctions:** Monetary fines, warnings, suspension or revocation of licenses/permits, restrictions on operations.

**Criminal Charges:** For serious breaches or involvement in money laundering or terrorist financing activities, individuals and entities can face imprisonment and substantial financial penalties as prescribed by the AML/CFT Law. The CBJ has the authority to refer such cases to the relevant judicial authorities.

**Central Bank of Jordan (CBJ) Circular No. 10/2022:**

Central Bank of Jordan Official Website (Navigation might be required to find specific circulars, which are often published in Arabic).

**Example of legal analysis referencing the circular:**

Al Tamimi & Company Legal Update: Jordan Regulates Virtual Assets and Virtual Asset Service Providers (Provides a summary and interpretation of Circular 10/2022)

**Anti-Money Laundering and Counter-Terrorist Financing Law No. 20 of 2021:**

This is the overarching AML/CFT legislation in Jordan. While an official English translation link can be hard to find publicly, legal databases often contain it.

**Reference point:** The law establishes the legal framework for combating money laundering and terrorist financing, granting powers to the AMLCFTU and relevant supervisory authorities like the CBJ.

For background on the Travel Rule itself:

FATF Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers (June 2021 Update)

**Reference:** Central Bank of Jordan (CBJ) official statements and warnings on virtual currencies. While specific dedicated pages might change, the CBJ's position is consistently communicated through press releases and official advisories.

*Search for news/press releases related to "cryptocurrency" or "virtual assets" on their site.*

**Individuals:** Jordan generally **does not impose a separate capital gains tax** on the sale of movable assets (like shares, bonds, or, by extension, cryptocurrencies if considered an asset) held by individuals, provided these gains are not derived from a "business activity."

If an individual frequently trades cryptocurrencies in a manner that could be construed as a business activity, the profits *could* theoretically be subject to income tax under general principles. However, given the CBJ's ban, engaging in such activities regularly might also raise regulatory concerns.

**Businesses:** If a company were to legally engage in buying and selling cryptocurrencies (e.g., if it's operating outside Jordan's financial system or if the rules were to change), any profits realized from such activities would be considered **ordinary business income** and would be subject to the standard corporate income tax rates.

**General Principle:** Income derived from any source in Jordan is generally subject to income tax. The challenge with crypto is determining what constitutes a legally recognized "source of income."

**Mining:** If a business or individual undertakes crypto mining, and the resulting crypto is sold for profit, this could theoretically be considered income. For businesses, it would be part of their taxable income. For individuals, if it's done systematically for profit, it *could* be argued by tax authorities to be a taxable activity, falling under general income tax rules.

**Staking, Lending, DeFi Yields, Airdrops:** Similar to mining, any income generated from these activities would likely fall into the same ambiguous category. If legally recognized and substantial, it would be subject to income tax. However, the CBJ's stance complicates the legitimacy of such income streams within Jordan.

**Salaries/Payments in Crypto:** Given the CBJ's position, it is highly unlikely that salaries or payments for services in cryptocurrency would be legally recognized or permitted within Jordan's formal economy. If, hypothetically, an individual were to receive crypto as payment, its fair market value in JOD at the time of receipt would theoretically constitute taxable income.

**Reference (General Income Tax Law):**

**Income Tax Law No. 34 of 2014 (and subsequent amendments):** This law governs all income tax in Jordan.

*Available via the official website of the Income and Sales Tax Department (ISTD) or legislative databases in Jordan.*

*ISTD website:* https://www.istd.gov.jo/ (Look for "Laws and Regulations" or "Legislation")

Jordan applies a General Sales Tax (GST) to the supply of goods and services.

**Lack of Specificity:** There is no specific GST legislation or guidance on the treatment of cryptocurrencies.

**Analogy to Financial Services:** Traditionally, many financial services are either exempt from GST or zero-rated. If cryptocurrencies were to be recognized as a financial asset or currency, then their sale might be exempt.

**Analogy to Goods/Services:** If cryptocurrencies are considered neither currency nor financial assets, their categorization becomes problematic.

The direct sale/purchase of a cryptocurrency itself by an individual is unlikely to be subject to GST, similar to how the sale of personal property (like a used car or personal shares) is not usually subject to GST unless it's part of a business's taxable supplies.

**Fees:** Any fees charged by a platform or service provider (e.g., for exchange services, if such were legally permitted) would likely be subject to GST as a service fee. However, again, such services are heavily restricted by the CBJ.

**Reference (General Sales Tax Law):**

**General Sales Tax Law No. 6 of 1994 (and subsequent amendments):** This law governs all sales tax in Jordan.

**General Reporting:** Individuals and businesses in Jordan are required to file annual income tax returns if they meet certain thresholds or have taxable income.

**Crypto-Specific Reporting:** There are **no specific reporting requirements for cryptocurrency holdings or transactions** in Jordan, primarily because they are not legally recognized or integrated into the regulated financial system.

**The Dilemma:** If an individual or business were to engage in cryptocurrency activities and generate income, the question arises whether this income should be reported. Given the CBJ's ban, openly reporting income from prohibited activities could create a complex legal situation for the taxpayer.

**Businesses:** A business legally incorporated in Jordan would need to report all worldwide income. If it has legitimate crypto-related income from operations *outside* Jordan, it would generally be expected to report this income in its Jordanian tax filings. However, the legal and operational implications within Jordan remain significant.

**None:** As of my last update, Jordan **does not have any specific tax legislation pertaining to cryptocurrencies or virtual assets.** The lack of such legislation is a direct consequence of the regulatory approach taken by the Central Bank of Jordan, which has opted for prohibition and caution rather than integration and regulation.

**Capital Gains:** No specific capital gains tax for individuals; business profits are taxed as ordinary income.

**Income Tax:** No crypto-specific income tax; general income tax principles *could* apply to income from crypto if legally recognized and derived, but the CBJ ban makes this highly problematic.

**VAT/GST:** No specific GST treatment for crypto; general GST law applies to services, but crypto-related services are severely restricted.

**Reporting:** No crypto-specific reporting requirements due to lack of recognition and the CBJ ban.

**Specific Legislation:** No crypto-specific tax legislation exists.

**No Specific Classification:** Jordan's legislation does not explicitly define or classify stablecoins as e-money, payment tokens, or securities.

**Potential for Existing Frameworks (Hypothetical if Regulated):**

**E-Money/Payment Tokens:** If a stablecoin were to be recognized and regulated, it would most likely fall under the **Payment Systems and Services Law No. 11 of 2017**. This law governs electronic payment services, including e-money. A stablecoin could potentially be considered e-money if it represents electronically stored monetary value as a claim on an issuer, used for payment transactions.

**Payment Systems and Services Law No. 11 of 2017:**

*Example summary reference:* International Finance Corporation (IFC) on Jordan's Payment System (Though this is a general reference, the law is foundational to Jordan's payment system.)

*Another relevant source citing the law:* Central Bank of Jordan - Overview of Payment Systems (This page describes the regulatory framework for payment systems, implicitly referring to the Payment Systems and Services Law).

**Securities:** Less likely for typical stablecoins aiming for price stability. However, if a stablecoin's design includes features that give holders rights to profits, equity, or other investment characteristics, it *could* potentially be viewed as a security under the **Securities Law No. 18 of 2017**, regulated by the Jordan Securities Commission (JSC).

**Securities Law No. 18 of 2017:**

Jordan Securities Commission (JSC) - Laws and Regulations (This is the Arabic version. English translations of specific laws are often provided by law firms or on legal databases).

**None Specific:** Since stablecoins are not specifically regulated, there are no specific reserve requirements for stablecoin issuers in Jordan.

**Hypothetical E-money Requirements:** If a stablecoin were classified as e-money under the Payment Systems and Services Law, then the issuer would be subject to prudential requirements, including safeguarding customer funds, which typically involves holding reserves in highly liquid, low-risk assets (e.g., central bank funds, government bonds).

**None Specific:** There is no dedicated licensing regime for stablecoin issuers.

**Hypothetical E-money Licensing:** If a stablecoin issuer were to operate within Jordan and be classified as an e-money issuer, they would need to obtain a license from the Central Bank of Jordan as a Payment Service Provider (PSP) or E-Money Issuer under the Payment Systems and Services Law. This involves meeting capital requirements, governance standards, and anti-money laundering (AML)/combating the financing of terrorism (CFT) obligations.

**None Specific:** Without specific regulation, there are no legally guaranteed redemption rights for stablecoin holders in Jordan under a dedicated framework.

**Hypothetical E-money Rights:** If stablecoins were regulated as e-money, holders would likely have redemption rights as per e-money regulations, allowing them to convert their e-money back to fiat currency at par value.

**None:** Given the general lack of a regulatory framework for stablecoins, there are no specific rules or prohibitions regarding algorithmic stablecoins. Their inherent volatility and lack of direct fiat backing would likely make them even more subject to the CBJ's general warnings about high-risk cryptocurrencies.

**Exploration Stage:** The Central Bank of Jordan has publicly stated its interest in exploring Central Bank Digital Currencies (CBDCs).

In various reports and statements, the CBJ has indicated it is studying the potential benefits and risks of issuing a digital Jordanian Dinar (JOD) as part of its efforts to modernize the payment system and enhance financial inclusion.

**Reference:** While specific detailed project documents might not be public, the CBJ has referenced this in its strategic plans and communications.

*General CBJ statements on digital transformation and payment system modernization often allude to CBDC exploration. For instance, in annual reports or strategic outlooks.*

**Potential Impact:** If Jordan were to launch a CBDC, it would significantly impact the landscape for private stablecoins. A state-backed digital currency could potentially:

Reduce the demand for private stablecoins if the CBDC offers similar stability and efficiency.

Lead to clearer regulatory guidelines for private stablecoins, perhaps differentiating them from the CBDC and setting specific rules for their interoperability or coexistence.

However, until a CBDC is launched and a clear regulatory framework is established, the interaction remains speculative.

**Central Bank of Jordan (CBJ):** The primary financial regulator responsible for monetary policy, payment systems, and financial stability.

**Securities Law No. 18 of 2017:** Governs securities and investment instruments.

**Cybercrime Law No. 17 of 2023:** While not directly regulating stablecoins, this law provides a framework for addressing cyber-related crimes, including those that could involve cryptocurrencies (e.g., fraud, money laundering).

**Reference:** Jordan Cybercrime Law No. 17 of 2023 (summary in English, law itself is in Arabic)