RESEARCH: Grenada Stablecoin

Executive Summary

Crypto is emerging in Grenada with evolving regulations. The Central Bank of Grenada and the Securities and Exchange Commission (SEC) are expected to jointly regulate stablecoins, though specific legislation remains under development as of late 2025. As of October 2025, no dedicated crypto regulatory portal exists, but both authorities have issued public statements urging compliance with existing financial laws. Stablecoin issuers must maintain 1:1 reserve backing with eligible assets (cash, central bank reserves, or highly liquid government securities) and comply with AML/CFT standards through annual audits and robust governance. No stablecoin has yet been officially licensed in Grenada, but the practical reality suggests that businesses may operate under a de facto compliance regime pending formal rules. The regulatory landscape is nascent, with significant gaps and risks, including unclear licensing thresholds and enforcement mechanisms.

Regulatory Framework

Regulatory Bodies:

• Central Bank of Grenada (CBG): Responsible for overseeing payment systems, e-money issuance, and currency stability; expanding mandate to supervise digital asset activities.
• Securities and Exchange Commission (SEC) of Grenada: Regulates securities, including security tokens and tokenized real-world assets (RWAs).
• Financial Intelligence Unit (FIU) of Grenada: Enforces AML/CFT regulations.

Primary Laws:

• Proceeds of Crime Act (POCA): Governs anti-money laundering and counter-terrorism financing.
• Anti-Money Laundering Regulations: Latest update in 2024, mandates KYC/AML procedures for VASPs.
• Data Protection Act: Requires data localization for sensitive personal data but permits cross-border transfers under safeguards.

International Standing:

• Grenada is part of FATF and Moneyval initiatives, aligning with global AML/CFT standards. However, specific stablecoin regulations are still being formulated.

Licensing Requirements

Who Needs a License:

• Virtual Asset Service Providers (VASPs), including exchanges, custodians, and stablecoin issuers.
• Entities involved in tokenized real-world assets (RWAs).

Activities Requiring Licensing:

• Issuance and redemption of stablecoins.
• Custody services for digital assets.
• Tokenization of RWAs.

Capital Requirements:

• Minimum capital requirements are not explicitly stated but must meet fit-and-proper tests for directors and beneficial owners.
• Stablecoin issuers must maintain 1:1 reserve backing with eligible assets (cash, central bank reserves, or highly liquid government securities).

Application Process:

• Submit detailed business plans to the relevant authority (CBG or SEC).
• Pass fit-and-proper assessments.
• Provide evidence of operational controls and audit readiness.

Timeline & Structural Requirements:

• No formal timeline provided; ongoing consultations since early 2025 suggest a phased rollout by mid-2026.
• Entities must demonstrate robust governance, KYC/AML compliance, and reserve management policies.

Entities Licensed to Date:

• As of October 2025, no stablecoin or VASP licenses have been issued in Grenada. The practical reality indicates that entities may operate under informal compliance frameworks pending formal rules.

AML/KYC Requirements

• Customer Due Diligence (CDD): Tiered KYC procedures required; enhanced due diligence for politically exposed persons (PEPs).
• Record Retention: Transaction data must be retained for at least five years.
• Beneficial Ownership: Clear disclosure of beneficial ownership is mandatory.
• Politically Exposed Persons (PEP) Screening: Mandatory screening against UN, US, and EU sanctions lists.
• Suspicious Activity Reports (SARs): Must be filed promptly with the FIU for any suspicious transactions.

Enforcement Actions

• No specific enforcement actions related to stablecoins or digital assets have been reported as of October 2025. The Central Bank and SEC have issued warnings against unlicensed activities but no fines or revocations yet.
• Ongoing consultations since early 2025 suggest potential penalties, including fines and criminal sanctions, for violations once formal regulations are enacted.

Tax Treatment

• Corporate Income Tax: Applies to profits from digital asset activities at standard rates.
• Capital Gains Tax: Levied on disposals of crypto-assets, including stablecoins and tokenized assets, with exemptions for long-term holdings under certain thresholds.
• VAT/GST: No current application to digital asset transactions but may be considered in future reforms.
• Withholding Tax: Applies to cross-border payments involving digital assets.

Key Gaps & Risks

• Licensing Thresholds and Monetary Limits: Specific capital requirements and reserve backing thresholds are unclear, creating uncertainty for potential issuers.
• Regulatory Consistency: Shared oversight between CBG and SEC may lead to fragmented regulations, complicating compliance efforts.
• Enforcement Preparedness: Lack of enforcement actions thus far suggests limited readiness; risks include unregulated market participants and systemic vulnerabilities.
• Data Protection Compliance: Balancing AML requirements with Data Protection Act obligations poses challenges for KYC data handling.

Sources

• Stablecoin Regulation in Grenada

• Government of Grenada Portal

• Rapyd Payments Network

• Proceeds of Crime Act (POCA)

• Data Protection Act

• Stablecoin regulation in Grenada is nascent but emphasizes consumer protection, financial stability, and AML compliance. Stablecoin.so

• The Central Bank of Grenada and SEC are expected to jointly oversee stablecoins, with no dedicated portal yet but public statements urging compliance. Stablecoin.so

• Stablecoins are treated as e-money or payment tokens, favoring fiat-backed models for regulatory clarity. Stablecoin.so

• Tokenization of real-world assets is recognized but subject to securities laws and licensing. Stablecoin.so

• VASPs must obtain licenses from CBG or SEC, with stablecoin issuers required to maintain 1:1 reserve backing with eligible assets. Stablecoin.so

• Grenada’s AML/CFT framework is anchored in POCA and Anti-Money Laundering Regulations (2024 update). Stablecoin.so

• Issuers must conduct stress testing and maintain wind-down plans for orderly redemption. Stablecoin.so

• Data Protection Act mandates data localization but permits cross-border transfers under safeguards. Stablecoin.so

• Financial promotions involving stablecoins require clear risk warnings and disclosures about volatility and redemption rights. Stablecoin.so

• Cross-border servicing by VASPs requires local licensing or registration without a formal passporting regime. Stablecoin.so