Syria

**None are available or required.** Engaging in these activities with cryptocurrencies is generally prohibited under current Syrian financial regulations.

Any entity attempting to operate such services would be doing so outside the legal framework and would face severe legal repercussions.

Neither a registration nor a licensing regime exists for virtual assets. The regime is one of **prohibition**.

**Irrelevant.** Since the activities are prohibited, there are no prescribed requirements for capital, AML/KYC policies (specific to crypto, general financial AML/KYC still applies to traditional finance), or local presence for crypto businesses.

**There is no application process** for cryptocurrency licenses or registrations, as these are not issued.

**Central Bank of Syria Circular No. 6/M.A. (2021):**

**Content:** This circular, issued by the CBS, explicitly warns against dealing in cryptocurrencies, stating that they are illegal and involve high risks for users. It clarifies that cryptocurrencies are not recognized as legal tender in Syria and that dealing in them violates Syrian financial laws.

**Specific Prohibition:** It prohibits individuals and entities from creating, promoting, trading, or using any form of virtual currencies within Syria.

**Consequences:** The circular warns of legal prosecution for those found violating these directives.

**Official URL:** Finding a direct, publicly accessible, and stable URL to specific circulars on the Central Bank of Syria's website (especially older ones or those related to sensitive topics) from outside Syria can be challenging due to website structure, language barriers, and potentially limited public access to all internal directives.

**Main Central Bank of Syria Website:** http://cb.gov.sy/ (You may need to navigate the Arabic site to find specific regulations, but direct links to individual circulars are often not maintained in a public archive readily accessible.)

**Confirmation via News Sources:** The existence and content of Circular No. 6/M.A. have been widely reported by reputable financial news outlets covering the Middle East and global financial regulations, confirming the CBS's prohibitory stance.

**Legal prosecution:** Imprisonment and fines.

**Blocking of funds and accounts.**

**Involvement in illegal financial activities**, which could also have implications under international sanctions regimes due to Syria's status.

**Prohibition:** The Central Bank of Syria (CBS) has repeatedly issued warnings and directives prohibiting the use and trading of cryptocurrencies.

**Criminalization:** **Law No. 36 of 2022** (issued in November 2022) explicitly criminalizes various activities related to cryptocurrencies, including their use as a payment method, trading, and promotion. Penalties are severe, including imprisonment and hefty fines.

**Legislative Decree No. 33 of 2005 on Anti-Money Laundering:** This was the foundational AML law.

**Law No. 33 of 2014 amending Legislative Decree No. 33 of 2005:** This significantly updated and strengthened the AML framework, particularly to address terrorism financing. It incorporated a risk-based approach and expanded the scope of reporting entities.

**Legislative Decree No. 27 of 2013 on Counter-Terrorism Financing:** This decree specifically addresses the financing of terrorism, establishing measures and penalties.

**Identification and Verification:** Obtaining and verifying the identity of customers (individuals and legal entities) using reliable, independent source documents, data, or information. This includes names, addresses, dates of birth, national ID numbers, etc., for individuals, and registration details, beneficial ownership, and control structure for legal entities.

**Beneficial Ownership Identification:** Identifying and taking reasonable measures to verify the identity of the beneficial owner(s) of customers, including for legal persons and arrangements.

**Purpose and Nature of Business:** Understanding the purpose and intended nature of the business relationship.

**Ongoing Monitoring:** Conducting ongoing due diligence on the business relationship and scrutiny of transactions undertaken throughout the course of that relationship to ensure that the transactions are consistent with the institution's knowledge of the customer, their business, and risk profile.

**Enhanced Due Diligence (EDD):** Applying EDD for higher-risk situations, such as relationships with Politically Exposed Persons (PEPs), customers from high-risk jurisdictions, or complex transactions.

The reporting mechanism involves submitting a Suspicious Transaction Report (STR) without tipping off the customer.

There are provisions for freezing funds suspected of being related to money laundering or terrorism financing.

Customer identification data (e.g., copies of ID documents).

Account files and business correspondence.

Records of transactions, sufficient to reconstruct individual transactions.

**The Anti-Money Laundering and Counter-Terrorism Financing Commission (AMLCFTC):** This commission acts as the Financial Intelligence Unit (FIU) for Syria. It is responsible for receiving, analyzing, and disseminating suspicious transaction reports.

**Central Bank of Syria (CBS):** While the AMLCFTC is the FIU, the Central Bank of Syria is the main financial regulator and plays a key role in issuing regulations and supervising compliance for financial institutions under its purview.

**Central Bank of Syria:** http://www.cbs.gov.sy/ (Information on the AMLCFTC/FIU is typically housed or linked from the CBS website, as there isn't usually a separate public website for the FIU itself in many jurisdictions).

There are **no legal AML/KYC requirements** because the service itself is prohibited.

Engaging in such activities carries significant **criminal penalties** under Law No. 36 of 2022.

Furthermore, Syria is subject to international sanctions, making any financial activity, especially involving novel assets like crypto, extremely high-risk from an international compliance perspective.

**Prohibitions:** Broadly prohibits U.S. persons from engaging in most financial transactions, trade, and investment with Syria, its government, and certain designated entities or individuals. This includes providing any services (financial or otherwise) that would benefit the Syrian government or its affiliates.

**Application to Crypto:** U.S. persons (including U.S.-based VASPs, or non-U.S. VASPs using U.S. correspondent banking relationships or U.S.-based cloud infrastructure) are prohibited from facilitating, processing, or otherwise engaging in virtual currency transactions that involve, directly or indirectly, Syria, the Syrian government, or any Specially Designated Nationals (SDNs) linked to Syria.

**Syrian Sanctions Regulations (31 CFR Part 542):** https://www.ecfr.gov/current/title-31/subtitle-B/chapter-V/part-542

**Caesar Syria Civilian Protection Act of 2019 (Caesar Act):**

**Purpose:** Imposes additional sanctions targeting foreign persons who provide significant financial, material, or technological support to the Syrian government or its officials, or who engage in specific economic activities (e.g., related to petroleum, military support, reconstruction, or aircraft maintenance).

**Application to Crypto:** This act expands the scope of potential secondary sanctions, meaning non-U.S. VASPs could face U.S. sanctions if they knowingly facilitate significant virtual currency transactions for persons or entities involved in activities sanctioned by the Caesar Act, even if those persons are not explicitly on the SDN list.

**OFAC Guidance on Virtual Currency:**

OFAC has consistently stated that its sanctions programs apply to virtual currency transactions in the same manner that they apply to traditional fiat currency transactions. They expect VASPs to implement sanctions compliance programs commensurate with their risk, including screening customers and transactions.

**OFAC Enforcement Guidelines & Virtual Currency Guidance:** https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-compliance-and-enforcement/sanctions-compliance-guidance-and-information (Look for "Sanctions Compliance Guidance for the Virtual Currency Industry")

**Prohibitions:** Include an oil embargo, restrictions on certain investments, a freeze of the assets of the Syrian central bank within the EU, export restrictions on equipment and technology that might be used for internal repression or monitoring internet/telephone communications, and asset freezes and travel bans on listed individuals and entities.

**Application to Crypto:** EU-based VASPs, or any VASP operating within the EU's jurisdiction, are prohibited from making funds or economic resources available, directly or indirectly, to individuals or entities listed on the EU's Syria sanctions list. "Funds" and "economic resources" are defined broadly to include virtual assets. Providing virtual asset exchange, custody, or transfer services to sanctioned parties or to facilitate prohibited transactions (e.g., oil trade) would be a violation.

**Council Regulation (EU) No 36/2012 (Syria Sanctions):** https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02012R0036-20230601 (This is the foundational regulation, frequently amended)

**Prohibitions:** Primarily focus on an arms embargo, non-proliferation of weapons of mass destruction, and counter-terrorism measures. While there isn't a comprehensive UN asset freeze list specifically for the Syrian government, any individual or entity designated under UN counter-terrorism regimes (e.g., Al-Qaeda or ISIL sanctions lists) who is operating in or connected to Syria would be subject to asset freezes and other restrictions.

**Application to Crypto:** VASPs in UN member states must ensure they are not facilitating virtual asset transactions for any individuals or entities designated on UN sanctions lists, regardless of their location, including if they are linked to Syria.

**UN Security Council Consolidated List (for Al-Qaeda and ISIL sanctions):** https://www.un.org/securitycouncil/sanctions/un-sc-consolidated-list

VASPs must screen all customers (KYC) and beneficial owners against relevant sanctions lists, including:

**OFAC Specially Designated Nationals (SDN) and Blocked Persons List:** https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country-information/syria-sanctions (Link to Syria program page, from which SDN list access is provided).

**EU Consolidated List of Persons, Groups and Entities Subject to EU Financial Sanctions:** https://www.sanctionsmap.eu/#/main (Interactive map including Syria sanctions list).

**UN Security Council Consolidated List:** https://www.un.org/securitycouncil/sanctions/un-sc-consolidated-list

Screening should be ongoing and extend to transaction parties where feasible (e.g., for Travel Rule compliance).

**Geographic Restrictions and IP Blocking:**

Due to the comprehensive nature of sanctions, many VASPs proactively block access to their services for users with IP addresses originating from Syria.

KYC procedures should identify users who are residents or citizens of Syria, triggering enhanced due diligence or outright prohibition of service, depending on the VASP's risk appetite and legal obligations.

VASPs must implement robust transaction monitoring systems capable of identifying patterns or characteristics indicative of sanctions evasion. This could include:

Transactions involving known Syrian wallets or addresses (if identifiable).

Unusual transaction volumes or frequencies for customers with any identified nexus to Syria.

Use of privacy-enhancing coins or mixers if linked to high-risk origins.

The Financial Action Task Force (FATF) has set global standards for virtual assets and VASPs, including Recommendation 15 and its interpretive note, which require VASPs to implement AML/CFT measures, including sanctions compliance.

The "Travel Rule" (FATF Recommendation 16, extended to VASPs) requires VASPs to obtain and transmit originator and beneficiary information for virtual asset transfers above a certain threshold. This information is critical for effective sanctions screening.

**FATF Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers:** https://www.fatf-gafi.org/content/fatf-gafi/en/publications/Guidance/RBA-VA-VASPs.html

VASPs subject to U.S. jurisdiction must block any property or interests in property of sanctioned persons (e.g., virtual assets) and report them to OFAC within 10 business days. They must also report all rejected transactions (those that would have been prohibited but were not completed) within 10 business days.

Similar reporting obligations exist under EU member state laws for EU-based VASPs.

**Jurisdictional Nexus:** Sanctions apply to transactions that have a nexus to the sanctioning authority.

**U.S.:** Applies to U.S. persons anywhere in the world, and to transactions within or transiting the U.S. financial system, or involving goods/services of U.S. origin. The Caesar Act significantly expands this to secondary sanctions for certain foreign persons.

**EU:** Applies to EU persons (citizens, residents, entities) and to transactions taking place wholly or in part within EU territory.

**UN:** Binding on all UN member states, who then implement them via national law.

**Targeted Geography:** Transactions involving individuals, entities, or governments *located in*, *resident in*, or *acting on behalf of* Syria are generally prohibited or highly restricted. This also extends to transactions that directly or indirectly *benefit* sanctioned parties in Syria.

**Civil Penalties:** Can range from thousands to millions of dollars per violation, depending on the program, specific violation, and whether it was voluntary or egregious.

**Criminal Penalties:** Can include significant fines and lengthy imprisonment for individuals (up to 20 years) and corporations (millions of dollars).

Penalties for breaching EU sanctions are determined by individual member states but are generally significant and can include fines and imprisonment.

**Reputational Damage:** Beyond legal penalties, VASPs face severe reputational damage, loss of partnerships, and de-risking by financial institutions if found to be in violation of sanctions.

**Regulator Name:** Central Bank of Syria (CBS)

**Entity Targeted:** All individuals and institutions within Syria engaging in or promoting cryptocurrency activities. This is a blanket prohibition rather than targeting a single entity.

**Violation Type:** Engaging in, trading, promoting, or possessing virtual currencies, deemed illegal and subject to severe penalties under Syrian law. The CBS views these activities as speculative, highly risky, and a threat to the national currency and financial stability.

**Penalty Amount:** No specific monetary penalty was announced for the policy itself. However, violations of this ban would likely incur severe penalties under existing Syrian laws related to financial crimes, illegal currency trading, or activities undermining the state's economic stability. These could include fines, asset forfeiture, and imprisonment, though specific case outcomes are not publicly disclosed.

**Date:** The CBS issued definitive warnings and circulars reiterating the prohibition throughout late 2022 and early 2023. While specific circular numbers or exact dates are not always widely publicized internationally, news reports consistently cite this period for the renewed and forceful stance.

**Outcome:** All cryptocurrency activities (trading, mining, possession, promotion) are officially illegal within Syria. This directive empowers authorities to crack down on anyone found dealing with digital assets. Reports from within Syria, though anecdotal and difficult to verify with official sources, suggest individuals have faced arrest and asset seizure for cryptocurrency-related activities following this ban.

**Al-Monitor:** "Syria’s central bank bans cryptocurrency trading" (February 2, 2023)

**Reuters:** "Syria's central bank bans cryptocurrency trading" (January 31, 2023)

https://www.reuters.com/markets/currencies/syrias-central-bank-bans-cryptocurrency-trading-2023-01-31/* (Note: May require subscription to view full article on Reuters directly, but the headline and summary are widely reported.)

**The National News:** "Syria central bank bans cryptocurrency trading" (February 1, 2023)