Monaco's government has introduced legislation that would repeal the Principality's existing 2022 crypto law and rebuild its regulatory framework for crypto-asset service providers around the European Union's Markets in Crypto-Assets Regulation (MiCA).

Bill No. 1131 was filed in early August. If approved, it would overhaul licensing requirements for firms offering crypto services and grant regulators broader enforcement powers. Although Monaco is not an EU member state, it uses the euro and maintains a customs union with France, making regulatory alignment with the bloc particularly significant for firms operating across borders.

Under the 2022 law, crypto and digital-asset activities were divided into two categories: issuance and operational services, which required clearance from the State Minister, and crypto-linked investment services, which were authorized by the Commission de Contrôle des Activités Financières (CCAF). That framework also mandated that providers register a company within Monaco and prohibited foreign firms from cold-marketing to residents.

The proposed bill would require any firm seeking to offer crypto-asset services in Monaco to obtain clearance from the CCAF. Before reaching that stage, applicants would first be reviewed by the Autorité Monégasque de Sécurité Financière and the Agence Monégasque de Sécurité Numérique. The legislation enumerates the specific crypto services permitted in Monaco and establishes clear rules governing corporate operations, risk management, and professional conduct.

The bill also expands the CCAF's authority to oversee and penalize firms, a measure the government says will strengthen efforts to combat money laundering and other financial crimes.

Monaco's push toward MiCA alignment comes amid sustained pressure over its anti-money-laundering record. The Principality has been on the Financial Action Task Force (FATF) grey list since the summer of 2024 and was placed on the European Commission's list of high-risk money-laundering jurisdictions more than a year ago. Such designations can lead to slower international transactions, elevated compliance costs, and increased borrowing costs for local businesses. Aligning with MiCA, which has been fully applicable across the EU since December 30, 2024, could signal Monaco's commitment to meeting international standards.

Blockchain intelligence firm TRM Labs has reported that crypto firms lacking MiCA authorization are significantly more likely to carry a high or severe risk rating.

Despite the regulatory framework being in effect, adoption remains incomplete: only 281 of the 1,343 crypto service providers operating across the European Economic Area have secured MiCA authorization. The slow uptake underscores the compliance burden MiCA imposes, and Monaco's proposed legislation will require firms currently operating under the 2022 regime to navigate a fresh approval process if the bill becomes law.