Regulatory AlertsPalestine: crypto & digital assets regulation
RegulatedVASP licensing via PMA under Law 41/2022; banking interface remains restricted
- Lead regulator
- Palestine Monetary Authority (PMA)
- Also involved
- —
- Core law
- Law No. 41 of 2022 Concerning National Payments
- Entry capital
- —
- Approval timeline
- —
- Customer assets
- Licensed custodian only
- Data protection
- —
- Sandbox
- No
The Palestine Monetary Authority (PMA) is the sole regulator for virtual asset service providers (VASPs) under Law No. 41 of 2022. While the law establishes a licensing framework for VASPs, the PMA has historically prohibited traditional banks and payment service providers from engaging in virtual currency transactions. The regulatory stance is evolving from prohibition to controlled licensing, with strict AML/CFT compliance required under Law No. 39 of 2022.
Which licence do you need?
| Your activity | Requirement | Capital | Timeline | Authority |
|---|---|---|---|---|
| Exchange / trading platform | LicenceVirtual Asset Service Provider License[1][2][3][4] Requires PMA license under Law 41/2022; banks prohibited from facilitating. | — | — | PMA |
| Custody of client assets | LicenceVirtual Asset Service Provider License[1][2][3][4] Included in VASP licensing scope under Law 41/2022. | — | — | PMA |
| Token issuance / public offering | Uncertainverify with regulator No specific token issuance rules found; likely falls under VASP or securities law. | — | — | — |
| Broker-dealer / OTC desk | LicenceVirtual Asset Service Provider License[1][2][3][4] OTC/dealing likely requires VASP license under Law 41/2022. | — | — | PMA |
| Stablecoin issuance | Uncertainverify with regulator No specific stablecoin regime identified; likely treated as VASP. | — | — | — |
| Crypto payments acceptance | LicenceVirtual Asset Service Provider License[1][2][3][4] VASP license required; traditional PSPs prohibited from crypto transactions. | — | — | PMA |
| Mining / staking services | Uncertainverify with regulator No specific rules for mining/staking; general VASP or unregulated. | — | — | — |
| Advisory / portfolio management | Uncertainverify with regulator No specific advisory rules found; likely unregulated or falls under VASP. | — | — | — |
New — what changed recently
- 2022-01-01Law No. 41 of 2022 Concerning National Payments — Established comprehensive licensing framework for VASPs under PMA supervision, replacing previous prohibitions with a regulated regime.[1][2][3][4]
- 2022-01-01Law No. 39 of 2022 on Combating Money Laundering and Terrorist Financing — Strengthened AML/CFT framework applicable to VASPs, designating PMA as supervisor.[5]
- 2023-01-01Circular No. 65/2023 — Reiterated prohibition on banks and financial institutions facilitating virtual asset transactions.[6]
Market-entry checklist
- 1Apply for VASP License from PMASubmit application under Law No. 41/2022 framework; specific capital requirements are not publicly detailed in source documents.
- 2Implement AML/CFT ComplianceAdhere to Law No. 39/2022 and PMA AML guidelines; register with relevant authorities if required.
- 3Establish Local Legal EntityIncorporate a company in Palestine to apply for the PMA VASP license.
- 4Secure Banking PartnershipsNote that traditional banks are prohibited from crypto transactions; arrange alternative fiat on/off ramps.
- 5Prepare Operational InfrastructureDeploy automated controls to block prohibited transactions as mandated by PMA circulars.
Sources
- Law No. (41) of 2022 concerning National Payments · 2022-08-08
- Law Decree No. 41 of 2022 Concerning National Payments · 2022-08-08
- Law No. 41 of 2022 Concerning the National Payments · 2022-08-08
- Circular No. 185-2022 National Payments Law · 2022-08-08
- Law No. (39) of 2022 on Combating Money Laundering and Terrorist Financing
- Circular No. 65 Virtual Assets and Currencies · 2023-03-15