Monaco has moved to tighten oversight of its cryptocurrency sector with a new licensing bill submitted to the National Council on August 6. Bill No. 1131 would replace elements of the principality's existing 2022 regulatory framework and introduce stricter authorization, governance, prudential, and compliance requirements for crypto-asset service providers. The proposal also aligns Monaco more closely with the European Union's Markets in Crypto-Assets (MiCA) regulation while incorporating key standards from the Financial Action Task Force (FATF).

The legislative push comes roughly eight months after MiCA's crypto-asset service provider rules became fully applicable across the EU in December 2024, a milestone that has prompted several neighboring non-EU jurisdictions to update their own digital-asset regimes to maintain regulatory coherence and cross-border business relationships.

CCAF-Led Licensing Framework

Under the proposed legislation, crypto-asset service providers would be required to obtain prior authorization from the Commission de Contrôle des Activités Financières (CCAF) before operating in Monaco. The CCAF would evaluate each applicant's proposed services, governance arrangements, prudential safeguards, and professional conduct standards before granting regulatory approval. This centralized approach would replace Monaco's current split structure with a unified licensing process covering all regulated crypto businesses and services.

License applications would also involve reviews by two additional authorities before the CCAF issues a final decision. The Autorité Monégasque de Sécurité Financière (AMSF) would examine financial-security matters related to applicants and their planned business operations. The Agence Monégasque de Sécurité Numérique (AMSN) would assess cybersecurity controls and other digital security requirements applicable to licensed providers.

The bill would significantly expand the CCAF's supervisory and enforcement powers over authorized crypto-asset service providers. As a result, Monaco would strengthen ongoing oversight after authorization rather than concentrating regulatory scrutiny primarily on market entry. The government states that the framework is designed to improve compliance standards and reduce exposure to money laundering and other illicit financial activity.

Alignment With MiCA and FATF Standards

The proposed system would bring Monaco closer to the authorization model employed across the European Union under MiCA, which requires regulated crypto providers to meet rules covering governance, client protection, prudential controls, and professional business conduct. However, Monaco is not an EU member state and would apply its own national framework under the proposed legislation. Because Monaco sits outside the EU and the European Economic Area, licenses issued under Bill No. 1131 would not grant crypto firms automatic passporting rights to offer services across EU member states — a distinction that could affect Monaco's attractiveness as a base for companies seeking broader European market access.

The reform arrives amid heightened international scrutiny of Monaco's anti-money laundering controls and financial supervision. FATF placed the Principality under increased monitoring in June 2024, a designation commonly referred to as the organization's grey list. The European Union also classifies Monaco as a high-risk third country for money laundering and terrorist financing controls.

Monaco adopted Law No. 1.528 in July 2022 to regulate businesses providing services involving digital assets and crypto assets. That legislation separated providers by activity type, with some companies requiring direct approval from the Minister of State. Investment-related crypto services fell under the CCAF, creating the two-track approval structure that Bill No. 1131 would replace.

Replacing the Existing Two-Track System

Under the current framework, different approval routes apply depending on the type of crypto service a company provides. Some operators require ministerial approval, while businesses offering investment-related services already face CCAF oversight. Bill No. 1131 would simplify this structure by consolidating regulated crypto services under a clearer, single-track authorization system.

The proposed legislation also defines the specific crypto-asset services that companies may legally provide within Monaco. Authorization would be linked to governance quality, financial safeguards, operational controls, cybersecurity standards, and professional conduct requirements. Licensed companies would therefore face broader obligations covering both their internal organizational structures and their handling of regulated activities.

If the National Council approves the bill, Monaco would subsequently issue implementing regulations detailing how the new requirements would operate in practice. These measures would provide further guidance on licensing procedures, supervisory practices, compliance obligations, and other operational requirements for providers. The resulting framework would establish a stricter crypto regime in Monaco built around authorization, ongoing oversight, financial security, and regulatory accountability. Existing license holders operating under the 2022 framework would likely need to transition to the new regime, a process that implementing regulations would need to address.