Mozambique -- Custody Regulations Regulatory Overview

Mozambique is still in the early stages of developing a comprehensive regulatory framework for cryptocurrencies and digital assets. As of my last update, there are no specific, comprehensive regulations in place that address digital asset custody requirements in Mozambique.

Here's a breakdown of the current situation:

General Regulatory Stance

1. Bank of Mozambique (BdM) Position: The Banco de Moçambique (BdM), the country's central bank, has consistently issued warnings regarding the risks associated with cryptocurrencies. It has clearly stated that cryptocurrencies are not considered legal tender in Mozambique and are not regulated or supervised by the central bank. The BdM advises the public against using them due to risks such as price volatility, lack of consumer protection, and potential for money laundering and terrorist financing.

   • Reference: While a direct "circular" or "law" explicitly stating this for general public access might be challenging to link, this stance is widely reported by Mozambican media based on BdM official statements and press releases. You can monitor the BdM's official website for notices:
     • Banco de Moçambique Official Website: https://www.bankofmozambique.co.mz/

2. No Specific Digital Asset Legislation: Mozambique does not have dedicated laws or regulations for digital assets that define them, regulate their issuance, trading, or custody.

Specific Custody-Related Aspects

Given the above, the specific custody requirements you're asking about do not exist in Mozambique's current regulatory landscape:

• Custodial License Requirements: There are no specific licenses for cryptocurrency custodians. Any entity offering such services would operate in an unregulated space, or potentially be subject to general financial services licenses if their activities overlap with traditional financial services (which is unlikely given the BdM's stance on crypto not being legal tender).
• Segregation of Client Assets Rules: No rules exist for the segregation of client digital assets.
• Insurance/Bonding Requirements: There are no insurance or bonding requirements for digital asset custodians.
• Cold Storage Mandates: No mandates or regulations specify the use of cold storage for digital assets.
• Qualified Custodian Definitions: There is no legal definition for a "qualified custodian" in the context of digital assets.

Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT)

While specific custody regulations are absent, Mozambique does have an AML/CFT framework. The Financial Information Unit (Unidade de Informação Financeira - UIF) is the primary authority for AML/CFT oversight.

• Law No. 14/2013 of August 12 (AML/CFT Law): This law establishes the legal framework for preventing and combating money laundering and the financing of terrorism.
  • Reference: While an official government portal link to the full text can be hard to find consistently online in English, the law is known as "Lei n.º 14/2013, de 12 de Agosto." You might find it on legal databases or law firm websites specializing in Mozambique.
  • Unidade de Informação Financeira (UIF) Website: http://www.uif.gov.mz/

It is possible that, under a broad interpretation, certain activities related to digital assets could fall under the purview of this AML/CFT law, especially if virtual asset service providers (VASPs) are eventually recognized as "reporting entities" or "financial institutions" through future amendments or specific regulations. However, the law as it stands does not explicitly define or regulate VASPs or crypto custody services.

Pending Custody Legislation

There is no publicly known specific pending legislation dedicated to digital asset custody in Mozambique. While the Bank of Mozambique has indicated it is studying digital innovations, including potentially a Central Bank Digital Currency (CBDC), and exploring broader regulatory approaches to fintech, concrete bills or regulations focused on crypto custody are not currently on the legislative agenda. Any future regulation is likely to start with a broader framework for digital assets before delving into highly specific custody requirements.

Summary

In summary, Mozambique currently operates with a very cautious approach to cryptocurrencies, driven primarily by the Central Bank's warnings about their risks and unregulated status. This means there are no specific laws, licenses, or operational requirements for digital asset custody. Any entity engaging in such activities does so without a clear regulatory framework, which carries significant legal and operational risks.

It is crucial for anyone considering digital asset activities in Mozambique to consult with local legal counsel for the most up-to-date information and interpretation of general financial laws that might indirectly apply.