Iraq Toughens Stance on Cryptocurrency, Targets Money Laundering and Fraud

Stricter Regulations to Combat Illicit Activities

Baghdad, December 9, 2023 - Iraq has taken a significant step to regulate its cryptocurrency market by introducing stricter rules on anti-money laundering (AML) and consumer protection. The new regulations aim to prevent the misuse of cryptocurrencies for illicit activities and maintain the integrity of Iraq’s financial system.

Key Features of the New Regulations

• Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF): Cryptocurrency service providers operating in Iraq must adhere to robust AML and CTF protocols, including Know Your Customer (KYC) processes and suspicious transaction reporting.
• Consumer Protection: Cryptocurrency exchanges and wallet providers are subject to stringent security and transparency standards to ensure the safety and protection of users’ investments.
• Taxation and Compliance Requirements: Cryptocurrencies are classified as a distinct form of digital asset, subjecting them to taxation, compliance requirements, and transaction monitoring.

Benefits for Iraq’s Fintech Sector

The introduction of regulatory sandboxes is expected to promote technological innovation in the fintech sector. This approach will allow startups and companies to develop and test new cryptocurrency-related products and services within a controlled regulatory environment, while regulatory authorities gain insights into emerging trends and potential risks in the digital currency space.

Commitment to Regulatory Excellence

Iraq’s commitment to integrating cryptocurrencies into its economic system in a controlled and beneficial manner is evident. The updated regulations reflect this commitment, aiming to provide clarity and stability to the cryptocurrency market while mitigating the risks associated with them. As the landscape of digital finance continues to evolve, it is anticipated that Iraq will continue to refine and update its regulatory policies to ensure their effectiveness and relevance in the ever-changing world of digital finance.

By adopting these measures, Iraq aims to establish a secure and reliable environment for cryptocurrency transactions, promoting innovation and growth in the fintech sector. The country’s commitment to regulatory excellence will help maintain the integrity of its financial system and protect investors from illicit activities.