San Marino -- Regulatory Status Regulatory Overview

San Marino has adopted a comprehensive and forward-looking approach to the regulation of cryptocurrencies and virtual assets, aiming to position itself as an innovative hub while adhering to international standards for financial stability and anti-money laundering.

Current Cryptocurrency/Virtual Asset Regulatory Status in San Marino

1. Regulatory Approach: Comprehensive

San Marino has established a comprehensive regulatory framework for virtual assets and virtual asset service providers (VASPs). This approach aims to provide legal certainty, foster innovation, protect investors, and prevent illicit activities such as money laundering and terrorist financing. The framework covers the definition of virtual assets, the authorization and supervision of VASPs, market conduct rules, and robust AML/CFT measures.

2. Primary Regulatory Bodies:

• Banca Centrale della Repubblica di San Marino (BCRSM) - The Central Bank of the Republic of San Marino. It is the primary financial regulator responsible for licensing, supervision, and ongoing oversight of virtual asset service providers.
  • Website: https://www.bcsm.sm/
• Agenzia per l'Informazione Finanziaria (AIF) - The Financial Intelligence Agency. This agency is responsible for preventing and combating money laundering and terrorist financing, operating within the broader AML/CFT framework that also applies to virtual asset activities.
  • Website: https://www.aif.sm/

3. Key Legislation Names and Dates:

• Law No. 166 of December 17, 2019, "Provisions for the Regulation of Virtual Assets and Providers of Virtual Asset Services"
  • Date: December 17, 2019
  • Purpose: This is the foundational law for virtual assets in San Marino. It defines virtual assets and virtual asset service providers (VASPs), establishes the general principles for their regulation, and designates the BCRSM as the competent authority for authorization and supervision. It aims to foster the development of blockchain technology while ensuring legal certainty and investor protection.
  • Note: While a direct official URL to the specific law text might be difficult to access publicly in English, references are widely available in legal analyses.
• BCRSM Regulation No. 2020-03 of December 10, 2020, "Regulation for the Authorisation and Supervision of Virtual Asset Operators"
  • Date: December 10, 2020
  • Purpose: This regulation provides the detailed implementation rules for Law No. 166. It specifies the requirements for obtaining authorization as a VASP from the BCRSM, including organizational, operational, capital, and governance requirements. It also outlines the ongoing supervisory framework, reporting obligations, and measures for consumer protection.
  • URL (Italian): https://www.bcsm.sm/site/home/documenti/normativa/regolamenti-bcsm/regolamento-n-2020-03-regolamento-per-lautorizzazione-e-la-vigilanza-degli-operatori-in-attivita-virtuali.html
• Law No. 92 of June 17, 2008 (and subsequent amendments), "Prevention and Repression of Money Laundering and Terrorist Financing"
  • Date: June 17, 2008 (with ongoing amendments to incorporate FATF recommendations, including those for virtual assets).
  • Purpose: This overarching AML/CFT law applies to all financial activities in San Marino, including virtual asset services. It mandates specific obligations for VASPs regarding customer due diligence, suspicious transaction reporting to the AIF, record-keeping, and internal controls to prevent money laundering and terrorist financing.
  • Note: Specific amendments to include VASPs fall under the purview of this law, ensuring San Marino's compliance with FATF Recommendation 15.

4. Current Stance on Crypto Trading and Exchanges:

San Marino has a permissive but highly regulated stance on crypto trading and exchanges:

• Legality: Crypto trading and the operation of crypto exchanges (classified as Virtual Asset Service Providers or VASPs) are legal in San Marino.
• Authorization Required: Any entity wishing to provide virtual asset services, including operating an exchange, facilitating trading, custody, or transfer of virtual assets, must obtain a specific authorization from the Banca Centrale della Repubblica di San Marino (BCRSM).
• Stringent Requirements: VASPs are subject to a robust set of regulatory requirements, including:
  • Capital Requirements: Sufficient capital to ensure financial stability.
  • Fit and Proper Tests: For shareholders, management, and key personnel.
  • Organizational and Operational Requirements: Including robust IT security, governance frameworks, and internal controls.
  • Investor Protection: Measures to protect client assets, ensure transparency, and manage conflicts of interest.
  • AML/CFT Compliance: Strict adherence to anti-money laundering and counter-terrorist financing obligations, including comprehensive customer due diligence (KYC), transaction monitoring, and reporting suspicious activities to the AIF.
  • Segregation of Client Assets: Requirements to separate client virtual assets from the company's own assets.
  • Transparency: Obligations regarding clear and truthful information for users.

San Marino's framework is designed to attract legitimate businesses in the blockchain and virtual asset space by offering a clear regulatory path, while simultaneously upholding strong standards of supervision and financial integrity.