Crypto ATM / kiosk operator in Tanzania

Lack of Specific Licensing Regime: There is no specific law or regulation in Tanzania that explicitly defines, regulates, and provides for the licensing of cryptocurrency exchanges, custody providers, or payment processors as virtual asset businesses.

Current Stance (Implied): While formal prohibition may not be explicit in specific crypto legislation, the lack of a regulatory framework and the BOT's historical cautious stance on unregulated financial activities mean that operating an unlicensed crypto business could face significant legal uncertainty and potential challenges under existing general financial laws.

Exchanges: If an exchange facilitates the exchange of fiat currency for cryptocurrencies, or vice versa, it might be seen as engaging in money transmission or payment processing activities.

Payment Processors: Companies facilitating payments using virtual assets, especially if they involve conversions to/from fiat currency, might be subject to the existing National Payment Systems Act, 2015 (and its regulations) administered by the Bank of Tanzania, depending on the interpretation of "payment system" and "electronic money."

HIGHLY LIKELY & CRITICAL: Even without a specific crypto licensing regime, Tanzania has a robust Anti-Money Laundering Act, 2006 (and subsequent amendments/regulations) and a Financial Intelligence Unit (FIU). Financial institutions and Designated Non-Financial Businesses and Professions (DNFBPs) are obligated to comply with AML/CFT (Anti-Money Laundering and Combating the Financing of Terrorism) requirements.

Highly Likely: For any regulated financial service, a local presence (e.g., a locally incorporated entity, physical office, local management) is typically a prerequisite in Tanzania. This would almost certainly be a requirement for any future crypto licensing.

The Anti-Money Laundering Act (AMLA), 2006 (as amended): This is the principal legislation establishing the legal framework for combating money laundering. It defines "financial institutions" and "other reporting institutions" and imposes obligations on them. While VASPs may not be explicitly listed, their activities are likely to be interpreted as falling under the scope of financial services or other reporting obligations.

The Anti-Money Laundering Regulations, 2012 (as amended): These regulations provide detailed rules and procedures for implementing the AMLA, including customer due diligence, suspicious transaction reporting, and record-keeping.

The Anti-Terrorism Act, 2002 (as amended): This act provides the legal framework for combating terrorism financing.

Natural Persons: Collecting and verifying full legal name, date of birth, residential address, nationality, national identification number (e.g., National ID, passport, driver's license). Verification should be done using reliable, independent source documents, data, or information.

Beneficial Ownership: Identifying and verifying the identity of the ultimate beneficial owner(s) of the virtual assets or the entity, ensuring that the VASP knows who ultimately owns or controls the funds/assets.

Ongoing Monitoring: Continuously monitoring the business relationship and transactions undertaken by the customer to ensure that they are consistent with the VASP's knowledge of the customer, their business, and risk profile. This includes monitoring for unusual or suspicious activities.

Enhanced Due Diligence (EDD): Applying EDD for higher-risk situations, which may include:

Obligation to Report: Any VASP, or its employees, that knows or suspects that a transaction (or attempted transaction) involves funds or virtual assets derived from illegal activity, or is related to money laundering or terrorism financing, must report it.

Reporting Mechanism: Reports must be submitted to the FIU Tanzania promptly and without delay, typically through a prescribed format (e.g., an online portal or specific form).

No Tipping-Off: VASPs and their employees are prohibited from "tipping-off" customers or third parties that an STR has been or will be submitted.

Duration: All records must be kept for a minimum period of five (5) years after the business relationship has ended or after the date of the transaction.

Entity Targeted: The general public, financial institutions, and any individuals or entities attempting to deal in, facilitate, or operate businesses involving cryptocurrencies. Violation Type: Dealing in, facilitating, or promoting instruments not recognized as legal tender; operating unauthorized financial services. Penalty Amount: Not a specific fine amount applied in a single action, but the outcome implies potential prosecution under existing financial laws for unauthorized activities.

Outcome: Cryptocurrencies are not recognized as legal tender in Tanzania. Financial institutions are prohibited from facilitating crypto transactions. This creates a high-risk environment for anyone operating a crypto business, as they would be operating outside the legal framework and subject to potential criminal charges rather than regulatory fines.

Bank of Tanzania's Stance (via news report):