Quick Answer
Cryptocurrency is not banned but remains largely unregulated.
- The central bank warns against using unofficial digital currencies.
- However, some resorts accept crypto and a new financial hub is planned.
Legal Status of Crypto in Maldives
Cryptocurrency in the Maldives occupies a legal gray area; it is not explicitly illegal, but it is also not recognized as legal tender or a formal financial product. This ambiguous status is shaped by the Maldives Monetary Authority (MMA), which, under the Maldives Monetary Act, has not granted permission for crypto transactions and has warned against using unofficial currencies. While there are no specific crypto regulations, any financial activities would still fall under broader compliance rules like the Prevention of Money Laundering and Financing of Terrorism Act. Despite the official cautionary stance, some businesses in the tourism sector accept crypto payments, and the government is exploring a blockchain-focused financial center.
Current Regulations
The Maldives currently lacks a specific regulatory framework for cryptocurrencies. The Maldives Monetary Authority (MMA) has not authorized any entity to conduct financial transactions with virtual currencies, citing its exclusive authority under the Maldives Monetary Act 1981. Consequently, the Bank of Maldives clarifies that cryptocurrency is not treated as a formal financial product, and the MMA has issued public warnings against using unofficial digital currencies.
Regulatory Authorities
The primary regulatory body overseeing finance in the Maldives, which would extend to crypto, is the Maldives Monetary Authority and its associated units.
- Maldives Monetary Authority (MMA):The MMA is the nation's central bank and primary financial regulator, responsible for supervising financial institutions and issuing the national currency. Under the Maldives Monetary Act, it has not authorized any crypto-related transactions and warns against using unofficial currencies.
- Financial Intelligence Unit (FIU):This unit, operating within the MMA, is tasked with receiving and analyzing reports on suspicious financial activities to combat illicit financing. Financial institutions are required to report suspicious transactions to the FIU under the Prevention of Money Laundering and Financing of Terrorism Act.
Historical Context
The regulatory landscape for crypto in the Maldives has seen a dramatic shift. Initially, in 2018, the Maldives Monetary Authority (MMA) effectively prohibited crypto transactions, stating no permission had been granted for their use under the Maldives Monetary Act 1981. This restricted the formal financial sector from engaging with digital assets. More recently, policy has pivoted significantly. The government is now backing a $9 billion project to establish a blockchain-focused financial free zone. This move aims to diversify the economy beyond tourism and signals a strategic embrace of fintech, a stark contrast to its earlier cautionary stance.
Compliance Requirements for Businesses in Maldives
- Anti-Money Laundering (AML) Checks: Businesses must comply with the Prevention of Money Laundering and Financing of Terrorism Act (10/2014). This requires verifying the source of funds and purpose of transactions under specific circumstances, including when establishing a business relationship, for single transactions of 50,000 MVR or more, for fund transfers, or whenever there is suspicion of illicit activity, as detailed in the Bank of Maldives regulations.
- Know Your Customer (KYC) Requirements: Institutions must acquire and verify valid personal or business information from all customers and beneficial owners—the person who ultimately controls the customer or on whose behalf a transaction is conducted. This process includes confirming income and the purpose of the business relationship.
- Mandatory Procedures and Reporting: If a company cannot fulfill its due diligence obligations, it is required to refuse or terminate the business relationship. Furthermore, if a customer refuses to provide the necessary information or if there is any suspicion of money laundering, the institution must report it to the Financial Intelligence Unit of the Maldives Monetary Authority.
Why this matters for Cross-Border Payments
For businesses conducting cross-border payments with India, the Maldives' regulatory landscape presents significant hurdles. The combination of an undefined legal status for crypto and stringent AML/KYC requirements means that transactions face heightened scrutiny and a greater risk of being flagged or delayed. This creates major pain points, including increased compliance overhead and the potential for financial institutions to refuse transactions, thereby hindering trade and investment flows between the two nations.
How Lightspark Enables Compliant Crypto-Native Payments
Lightspark provides infrastructure for the “Money Grid,” a global payment network built on Bitcoin. Its products, Lightspark Connect and Grid Switch, enable instant, low-cost cross-border payments by using native Bitcoin or existing domestic payment rails, respectively. This bypasses the delays and high fees of traditional banking, directly addressing the friction businesses face with ambiguous crypto regulations and heightened scrutiny on international transfers.
To help businesses meet stringent requirements like those in the Maldives, Lightspark's platform is designed to be compliant-ready. Grid Switch allows regulated institutions to leverage their existing compliant systems for global transfers. Features like audit-ready reporting and flexible custody options provide the tools needed to satisfy AML/KYC obligations, enabling firms to expand into new corridors while facilitating their own compliance.
To learn how you can enable compliant, instant cross-border payments, connect with Lightspark today.
Notice: This article is provided for informational purposes only and does not constitute legal advice.
Sources
- Bank of Maldives. "Investment fraud." Bank of Maldives, www.bankofmaldives.com.mv/investment-fraud.
- Bank of Maldives. "Laws & Regulations." Bank of Maldives, www.bankofmaldives.com.mv/regulations.
- Freeman Law. "Maldives and Cryptocurrency." Freeman Law, 2022, freemanlaw.com/cryptocurrency/maldives/.
- InvestAsian. "Investing in the Maldives: The Full Guide for 2025." InvestAsian, 2025, www.investasian.com/country-guides/investing-in-maldives/.
- Maldives Monetary Authority. "Maldives Monetary Authority." Maldives Monetary Authority, www.mma.gov.mv.
- Mazza, Rosalia. "Maldives Eyes Crypto Future with $9B Blockchain Investment Plan." FinTech Weekly, 5 May 2025, fintechweekly.com/magazine/articles/maldives-crypto-financial-centre-investment.
