Belarus Creates Legal Framework for Bitcoin and Crypto Banks

Belarus has taken a decisive step into the future of finance, formally establishing a legal framework for cryptocurrency banks. President Alexander Lukashenko signed Decree No. 19, "On Cryptobanks and Certain Issues of Control in the Field of Digital Tokens," creating a regulated path for hybrid financial institutions.

This landmark legislation positions the nation as a hub for financial technology innovation. It provides a clear, regulated environment for cryptocurrency services, blending the traditional banking world with the technological efficiency of digital tokens.

Under the new law, a crypto bank is specifically defined as a joint-stock company that is a resident of Belarus' High-Tech Park (HTP). These entities must also be included in a registry maintained by the National Bank of Belarus. This structure ensures that only firms registered with the HTP and listed in the official registry are eligible to operate.

Crucially, these institutions are not full commercial banks. They function as non-bank financial institutions subject to dual regulation. This hybrid model allows them to offer a unique combination of services:

• Traditional banking operations (deposits, loans, transfers)
• Activities involving digital tokens
• Services that link fiat and digital currencies
• Regulated by both banking and HTP standards

The decree ensures that crypto operations remain fully backed by fiat currency and subject to strict oversight, creating a secure environment for users.

The dual regulation system requires crypto banks to comply with rules for non-bank credit and financial institutions. This includes adherence to capital adequacy requirements, robust risk management protocols, and strict compliance with anti-money laundering (AML) and counter-financing of terrorism (CFT) obligations.

Consumer protection standards are also a mandatory component of the regulatory framework. Beyond these financial regulations, crypto banks must follow all decisions made by the HTP Supervisory Board, ensuring alignment with the park's broader technological and economic objectives.

"Dual regulation will allow a crypto bank to offer clients innovative financial products that combine the advantages of traditional banking operations with the technological efficiency, speed, and convenience of digital token transactions."

This regulatory clarity provides a stable foundation for innovation while maintaining necessary safeguards for the financial system.

This decree is not an isolated move but part of Belarus's sustained push to integrate digital finance with traditional banking infrastructure. The country has a notable history of early adoption in cryptocurrency regulation.

In 2017, a previous decree established tax-free conditions for cryptocurrency mining and trading, notably eliminating the requirement for individuals to declare crypto income. This early move signaled a proactive approach to embracing digital assets.

In recent years, President Lukashenko has actively promoted virtual payment systems and bitcoin mining projects. A notable initiative involved using surplus electricity to power mining farms in the Mogilev region, turning an energy resource into a digital asset. The country is also expected to launch its digital ruble in full-scale operation during the second half of 2026.

For local users and businesses, the new framework promises easier access to hybrid financial products. By enabling smoother and faster settlement, crypto banks may significantly reduce friction when moving between traditional and crypto-based transactions.

Globally, Belarus's move aligns with a broader trend toward on-chain finance and tokenized assets. Financial institutions worldwide are increasingly exploring blockchain technology for payments, trading, and asset management.

This shift is evident in recent developments across Europe. For instance, Belgium's KBC Group announced it will become the first local bank to let retail clients trade crypto, starting February 16 via its Bolero platform under the EU's MiCAR rules. Initially offering Bitcoin and Ether on an execution-only basis, clients must pass a risk-awareness test before trading.

Belarus's decree establishes a clear, regulated path for crypto banking, potentially offering a model for other nations seeking to balance innovation with financial stability.

The signing of Decree No. 19 marks a significant milestone in Belarus's financial evolution. By creating a legal framework for crypto banks, the nation is not only fostering innovation but also ensuring that such innovation occurs within a structured, regulated environment.

The key takeaways are clear: a defined legal structure for crypto banks, a dual regulatory system that balances traditional banking with digital innovation, and a continuation of Belarus's proactive stance on cryptocurrency. As the digital ruble launch approaches and global trends toward tokenized assets accelerate, Belarus has positioned itself at the forefront of this financial transformation.