| Mariam Dovlatyan, Associate, Attorney |
“Code is law.” – Lawrence Lessig. For much of crypto’s history, this idea captured a fundamental feature of the industry, with rules often embedded in technological protocols, transactions executed through code and legal regulation developing more slowly than the underlying technology. In Armenia, however, the regulatory landscape has changed significantly, where code is no longer the only framework governing the crypto market.
The country’s regulatory landscape has fundamentally shifted with the adoption of the Law on Crypto-Assets and the entry into force of the Central Bank of Armenia’s implementing regulations. By 2026, Armenia had transitioned from a relatively lightly regulated environment to a dedicated legal and supervisory framework governing crypto-asset services, licensing, prudential requirements, anti-money laundering compliance, client protection and regulatory oversight.
The shift is significant both for existing market participants and for businesses considering Armenia as a jurisdiction for crypto-related activities. Matters that were once largely commercial or technological now carry clear legal and regulatory implications: which activities require a licence, who may provide crypto-asset services, how may crypto be used, and what regulatory obligations follow?
This article outlines the principal rules in force in 2026 governing the Armenian crypto market, with particular focus on regulated crypto-asset services, licensing requirements, prudential and governance standards, AML/KYC obligations, client protection, taxation, data protection and regulatory enforcement.
The Legal Framework and Scope
Armenia’s crypto sector is governed primarily by the Law on Crypto-Assets, which entered into force in July 2025. The Law sets the core rules for the market, including which crypto-related activities are regulated, when a licence is required, what obligations apply to crypto-asset service providers and how the sector is supervised by the Central Bank of Armenia.
The framework was further developed through Central Bank regulations that entered into force in 2026 and address practical areas such as licensing, minimum capital requirements, registration of managers and crypto-asset offering documents.
Under the Law, a crypto-asset is broadly understood as a form of property based on cryptography that has value or represents a right and can be transferred and stored electronically using distributed ledger technology or similar technology.
It also recognises specific categories of crypto-assets, including asset-referenced tokens and electronic money tokens, while certain assets fall outside the regime, including genuinely unique and non-replaceable crypto-assets and assets that cannot be transferred to another person.
Accordingly, whether a digital asset is regulated under Armenia’s crypto legislation depends not only on the technology used, but also on its characteristics, function and transferability.
Which activities are regulated?
Not every activity involving crypto-assets requires a licence. Armenian law identifies a specific list of crypto-asset services that require regulatory authorisation.
These include operating a crypto-asset trading platform, custody of crypto-assets, buying and selling crypto-assets on one’s own account or on behalf of clients, receiving and transmitting client orders, placing crypto-assets, managing crypto-asset portfolios, providing crypto-related advice, transferring crypto-assets and issuing asset-referenced tokens.
As a general rule, regulated crypto-asset services may only be provided by an entity licensed by the Central Bank of Armenia. A crypto-asset service provider must generally be established as a limited liability company or joint-stock company and may only provide the services covered by its licence. Unlicensed provision or offering of regulated services is prohibited, subject to limited exceptions provided by law.
The public offering of crypto-assets is also regulated. Depending on the circumstances, issuers may be required to prepare and publish a crypto-asset offering document containing information about the issuer, the crypto-asset, the underlying technology and the associated risks.
How may crypto-assets be used in Armenia?
Crypto-assets may be owned, bought, sold and transferred in Armenia, subject to the applicable regulatory requirements. However, this does not mean that crypto-assets may generally be used as a means of payment.
The Armenian dram remains the legal means of payment in Armenia, and payments made with crypto-assets are generally prohibited. The exception is an electronic money token issued in accordance with the Law on Crypto-Assets.
Separate rules also apply to payments made when buying or selling crypto-assets. As a general rule, such payments must be made in non-cash form. However, until 1 January 2028, a temporary exception allows cash transactions of up to AMD 300,000, provided that the transaction is carried out with or through a crypto-asset service provider that identifies and verifies the customer and keeps the required transaction records. Payments for crypto-asset services themselves must exclusively be made in non-cash form where the payment is made or received in Armenia.
In practical terms, Armenian law therefore permits ownership and trading of crypto-assets within the regulatory framework, while continuing to restrict their use as a general means of payment.
Key obligations of crypto-asset service providers
Obtaining a licence is only the starting point. Once authorised, licensed providers are subject to continuing organisational, prudential and conduct requirements.
Among other things, providers must maintain appropriate internal controls, internal policies and procedures, ensure business continuity and information security, manage conflicts of interest and establish mechanism for handling client complaints.
They are also subject to minimum capital requirements. The applicable amount depends on the services provided, with fixed minimum capital thresholds ranging from AMD 10 million to AMD 200 million. Providers must also comply with additional capital calculations based on fixed operating costs and, in the case of asset-referenced token issuers, reserve assets.
Client protection is another central element of the framework. Providers must act fairly and professionally, disclose relevant risks and ensure that information and marketing communications are clear, accurate and not misleading.
Client funds and crypto-assets must be properly safeguarded and recorded separately from the provider’s own assets. Providers offering portfolio management or crypto-related advice are also subject to suitability requirements designed to ensure that the service is appropriate for the relevant client.
AML/KYC, Data Protection and Confidentiality
Anti-money laundering and customer-identification obligations form an important part of the regulatory framework. Most crypto-asset service providers fall within Armenia’s AML regime and are required to conduct customer identification and verification, apply risk-based due diligence, monitor business relationships and report qualifying or suspicious transactions. A specific statutory exception applies to persons providing the service of operating a crypto-asset trading platform.
Crypto transactions with a value equal to or exceeding AMD 1 million are subject to specific reporting requirements in the relevant financial-institution context.
Armenian law also applies a crypto-specific version of the travel rule. Financial institutions involved in crypto transfers must obtain and retain information about the sender and recipient and, where applicable, relevant wallet addresses or account information. Missing information may require enhanced risk measures or rejection of the transaction.
At the same time, crypto businesses remain subject to Armenia’s general personal data protection legislation. This is particularly relevant because providers routinely process identification documents, contact details, wallet information and transaction history for KYC and compliance purposes.
The Law on Crypto-Assets also protects client and transaction information through specific confidentiality obligations applicable to providers, their managers, employees and certain service providers.
Taxation
Armenian tax legislation now expressly addresses crypto-assets. The sale or other alienation of crypto-assets is exempt from VAT. This exemption applies to the crypto-asset itself and should be distinguished from fees charged for crypto-related services, which remain subject to the ordinary VAT rules where applicable.
For individuals, income from the disposal of ordinary crypto-assets is generally treated as non-taxable income. Different rules apply to certain categories, including genuinely unique and non-fungible crypto-assets and crypto-assets received as rewards for maintaining a distributed ledger or validating transactions.
Crypto-asset service providers operate under Armenia’s general taxation system and are expressly excluded from the turnover-tax and micro-enterprise regimes.
As with other areas of the regulatory framework, the tax treatment ultimately depends on the nature of the transaction and the activities performed.
Market Supervision and Enforcement
The Central Bank of Armenia is the principal authority responsible for regulating and supervising the crypto market. Its supervisory powers extend to licensed crypto-asset service providers and, where relevant, issuers, managers and qualifying shareholders. The Law also prohibits forms of market abuse, including misuse of inside information and market manipulation.
Where regulatory requirements are breached, the Central Bank may impose measures including warnings, fines, removal of managers from registration, restrictions on activities and revocation of licences or authorisations.
The framework therefore places continuing compliance at the centre of operating a regulated crypto business in Armenia. Obtaining a licence is only the beginning of the regulatory process, as providers remain subject to ongoing supervision throughout their operations.
Key Takeaways for Businesses
For businesses considering the Armenian crypto market, the key points are straightforward: determine whether the proposed activity requires a CBA licence, identify the applicable capital and compliance requirements, and account for ongoing AML/KYC, client-protection, data-protection and reporting obligations from the outset.
The regulatory analysis should therefore begin with the business model itself, as the applicable requirements depend largely on the specific crypto-asset services being offered.
Sources
- Lessig L, Code and Other Laws of Cyberspace (Basic Books 1999)
- Central Bank of Armenia, Regulation 7/01 on CASP licensing and qualifying holdings (2025)
- Central Bank of Armenia, Regulation 7/02 on CASP minimum capital requirements (2025)
- Central Bank of Armenia, Regulation 7/04 on crypto-asset offer documents (2025)
- Central Bank of Armenia, Regulation 7/05 on registration of CASP managers (2025)
- Republic of Armenia, Law on Crypto-Assets, HO-159-N (2025)
- Republic of Armenia, Civil Code.
- Republic of Armenia, Law on Non-Cash Operations, HO-12-N (2022)
- Republic of Armenia, Law on Combating Money Laundering and Terrorist Financing, HO-80-N (2008)
- Republic of Armenia, Law on Protection of Personal Data, HO-49-N (2015)
- Republic of Armenia, Tax Code, HO-165-N (2016), as amended