The government of Monaco has presented a bill to the legislature aimed at revising the Principality's legal framework for crypto-asset service providers, citing the rapid growth of the digital finance sector and changing international standards. Bill No. 1131 was officially presented to the National Council on August 6. If approved, it will replace the regime introduced in 2022 and ensure closer alignment of Monaco's regulations with the European Union's Markets in Crypto-Assets Regulation (MiCA) and the standards set by the Financial Action Task Force (FATF).
Under Law No. 1.528, adopted in July 2022, services related to crypto-assets and digital assets were divided into two regulatory categories based on the type of activity. Issuing assets and providing operational services required authorization from the Minister of State, while investment services related to crypto-assets required authorization from the Commission de Contrôle des Activités Financières (CCAF).
This regime also required service providers seeking licenses to register a company in Monaco, and foreign firms were explicitly prohibited from soliciting Monaco residents through unsolicited marketing.
The new legislation more clearly defines which crypto-asset services can be legally provided in Monaco and introduces stricter operational requirements covering corporate governance, prudential measures, and professional conduct standards. Under the proposed rules, service providers must obtain prior authorization from the CCAF.
According to a local report, licenses will only be issued after a joint assessment conducted by Monaco's Autorité Monégasque de Sécurité Financière and the Agence Monégasque de Sécurité Numérique. This measure also expands the CCAF's supervisory and enforcement powers. Government representatives stated that the enhanced oversight aims to ensure regulatory compliance and prevent money laundering and other illicit financial activities.
If approved by the National Council, the legal framework will be followed by secondary implementing decrees detailing the practical and technical requirements for businesses.
Monaco's decision to refine its cryptocurrency regulation comes more than a year after the country was included on the European Commission's list of high-risk countries for money laundering. Furthermore, the Principality has been on the FATF's 'grey list' since the summer of 2024.
Inclusion on the European Commission's high-risk list can lead to transaction delays and increased costs. Over time, such inclusion could result in downgrades to sovereign and corporate credit ratings, raising the cost of borrowing for local institutions on international capital markets.
