Lebanon: crypto & digital assets regulation

Lebanon maintains a restrictive stance where licensed financial institutions are explicitly prohibited from issuing, marketing, or trading electronic money, including Bitcoin, under joint directives from the Capital Markets Authority (CMA) and Banque du Liban (BDL). While the 2018 prohibition targets institutional participation, the 2026 Circular No. 750 establishes a regulatory framework for electronic banking operations, requiring prior approval or notification for services like KYC-E and Money-E, though it does not explicitly license crypto-asset service providers (VASPs).

The regulatory environment is characterized by a lack of a dedicated licensing regime for crypto businesses, with the primary focus on preventing licensed banks from engaging in crypto activities due to risks such as volatility and lack of central bank guarantees. General knowledge indicates that while retail possession is not explicitly banned by statute, the absence of a clear legal framework for VASPs and the strict prohibition on institutional involvement create significant operational barriers and legal uncertainty for crypto enterprises.

Recent direction of travel shows the central bank expanding oversight of digital financial services through electronic banking circulars, yet stopping short of creating a sandbox or licensing path for crypto-specific activities. The coexistence of the 2018 ban and the 2026 electronic banking rules suggests a cautious, fragmented approach where digital assets are managed through general banking regulations rather than a specialized crypto framework.