Armenia enacts crypto regulation law, industry pushes back - Trade Treasury Payments

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Armenia enacts crypto regulation law, industry pushes back

Armenia has passed its first formal regulatory framework on crypto-assets, a move officials say aligns the country with European Union standards and enhances financial safeguards. The law has drawn immediate criticism from local industry players who warn it could push legitimate operators out of the market.

Under the new legislation, which will be will be enforced by the Central Bank of Armenia, crypto service providers will be subject to different levels of oversight depending on the nature of their activities. Firms offering investment advice will face comparatively lighter requirements, while exchanges and stablecoin issuers will be subject to more stringent supervision. 

Regulators defended the approach by saying that any entity holding customer funds must be held to higher regulatory standards, noting that the law draws heavily from the EU’s Markets in Crypto-Assets (MiCA) regulation.

A significant change from earlier drafts is the new requirement that banks wishing to offer crypto services must establish a separate, licensed legal entity. The initial version of the bill would have allowed banks to operate in this space directly under Central Bank approval.

While the Central Bank views this as a necessary step toward clarity and consumer protection, industry stakeholders remain unconvinced. Detractors argue that the framework amounts to a de facto ban, describing the legislation as a continuation of unofficial barriers already in place, where risk-averse banks (advised by the Central Bank to steer clear of crypto) opt not to work with legally compliant businesses.

Many worry that the licensing model could make the cost of compliance (including capital requirements, office space, and auditing obligations) prohibitive for smaller players.

The law is scheduled to take effect on 1 January 2026, giving financial institutions and crypto firms a transition period to meet compliance obligations.