Crypto & Digital Assets · Iraq
Is crypto legal in Iraq? Regulation & rules (2026)
Iraq shaded by its crypto & digital assets status
The Central Bank of Iraq (CBI) explicitly prohibits all supervised financial institutions—banks, non-bank intermediaries, and electronic payment providers—from engaging with virtual assets via Circular No. 125/5/9 (2021), citing AML/CFT risks and absence of a regulatory framework. No VASP licensing regime exists, and the Kurdistan Regional Government (KRG) issued active enforcement bans on crypto and forex trading in 2025–2026, including stablecoins such as USDT. Individual possession is not explicitly criminalized by national statute, leaving private holdings in a legally ambiguous gray zone with severe practical constraints.
Key points
CBI Circular No. 125/5/9 (22 November 2021) forbids all CBI-supervised institutions from transacting in virtual assets. A follow-up directive on 26 March 2022 reinforced alignment with FATF Recommendations on mitigating ML/TF risks from virtual assets.
The Kurdistan Regional Government Ministry of Interior issued a directive banning all cryptocurrency and forex trading for citizens and commercial entities, explicitly naming stablecoins (USDT), and ordering office closures and judicial referrals for violators.
Iraq has no dedicated cryptocurrency or VASP licensing regime. Authorities invoke Article 36 of AML/CTF Law No. 39/2015 to treat virtual-asset activities as potential money-laundering predicate offenses, with no route for licensed exchange or custodial operation.
No Iraqi statute explicitly criminalizes individual possession or peer-to-peer crypto trading, but banking channels are blocked and AML laws may be invoked against flagged transactions, creating severe practical restrictions without a clear criminal prohibition.
In March 2025, Iraq's Prime Ministerial financial advisor announced the CBI is researching a central bank digital currency as a sovereign digital alternative to cash. The project remains in early development with no published timeline or draft legislation.
Multiple sources place Iraq among the small group of countries with comprehensive institutional crypto bans, with no licensing framework, active KRG enforcement, and the CBI classifying crypto as high-risk speculative instruments akin to Ponzi schemes.
Iraq - other topics
Last verified 5/24/2026 · Orientation, not legal advice - verify against the primary sources linked above. Explore the full world map →