Crypto Overview in Tanzania

Regulatory data is for informational purposes only and may not reflect the most current legal developments. Always consult qualified professionals before making decisions.

Legal Classification and Regulatory Framework

Cryptocurrency Status

Tanzania occupies a unique position in cryptocurrency regulation, marked by a fundamental tension between its central bank’s stance and its tax authority’s treatment of digital assets. The Bank of Tanzania (BoT) issued a public notice in November 2019 cautioning the public against trading, marketing, and using virtual currencies, affirming that the Tanzanian Shilling is the sole legal tender under the Bank of Tanzania Act (sections 26-27). However, no parliamentary legislation explicitly bans or criminalizes cryptocurrency ownership or trading.

A landmark court decision in December 2024, Yellow Card Tanzania Limited v. Nyamwero Michael Nyamwero, significantly shifted the legal landscape. The High Court ruled that cryptocurrency trading “is not illegal,” reasoning that operators paying taxes under Tanzanian tax law cannot have their transactions declared unlawful. The court awarded approximately USD 1.193 million to Yellow Card, a licensed crypto trading company. This represents the most significant judicial statement on crypto legality in Tanzania to date.

Adding further complexity, the Finance Act 2024 (effective 1 July 2024) introduced the first statutory definition of “digital assets” in Tanzanian law, defining them as anything of value that is not tangible, including cryptocurrencies, token codes, numbers held in digital form, and NFTs. While this definition was created for tax purposes, it represents a formal legislative acknowledgment of digital assets.

Tax Treatment

The Finance Act 2024 introduced a 3% withholding tax on digital asset transfers, applicable to payments made by persons who own a digital asset exchange platform or facilitate the exchange or transfer of digital assets. Platform operators and transfer facilitators are designated as withholding agents responsible for collection.

Beyond the withholding tax, profits from cryptocurrency sales or exchanges are subject to capital gains tax. For crypto trading conducted as a business activity, standard corporate tax rates of 30% apply to resident corporations, while individuals face a top marginal rate of 30%. Non-resident individuals are taxed at a flat 15% on employment income. The Tanzania Revenue Authority (TRA) administers these obligations, though detailed operational guidance on cost basis calculations or treatment of staking and mining income has not been publicly issued.

Regulatory Oversight

Several agencies have overlapping jurisdiction over aspects of crypto activity. The Bank of Tanzania serves as the primary financial regulator with authority over monetary policy, payments systems, and financial stability. The Capital Markets and Securities Authority (CMSA) regulates securities markets but has not issued specific guidance on virtual assets or security tokens. The Tanzania Communications Regulatory Authority (TCRA) oversees electronic communications under the Electronic Transactions Act of 2015, which requires licensing for cryptographic service providers. The Financial Intelligence Unit (FIU), established under the Anti-Money Laundering Act of 2006, handles suspicious transaction reporting and has incorporated virtual assets into its AML/CFT framework through amendments in 2022 and 2023.

Despite this multi-agency landscape, no single regulator has established a comprehensive VASP licensing or registration regime. Cryptocurrency exchanges operate without formal authorization, though the Bank of Tanzania has taken no enforcement action against them.

Business Environment

Banking Relationships

The BoT’s 2019 public notice implicitly discourages banks from facilitating cryptocurrency transactions, though no explicit circular prohibiting banks from serving crypto businesses has been publicly identified. In practice, crypto activity in Tanzania occurs primarily through mobile money platforms such as M-Pesa, Tigo Pesa, and Airtel Money, as well as peer-to-peer channels, rather than through direct bank-to-exchange integrations. The Yellow Card court case demonstrated that at least some crypto businesses maintain operational banking relationships within the country.

Licensing Requirements

Tanzania currently has no dedicated VASP licensing regime. The National Payments System Act No. 4 of 2015 requires BoT licensing for electronic payment systems, but the Bank has not created a pathway for crypto businesses to obtain such licenses. Multiple international and local cryptocurrency exchanges serve Tanzanian users without formal BoT authorization. Legal analysts view the contradiction between the tax framework (which recognizes crypto businesses) and the lack of a licensing path as unsustainable, with the Yellow Card court ruling adding pressure for regulatory clarity.

Innovation Support

Tanzania has taken meaningful steps toward fostering fintech innovation. The BoT launched its Fintech Regulatory Sandbox in July 2024 under Government Notice No. 540 of 2024, providing a controlled environment for testing financial innovations not covered by existing regulations. The first cohort launched in January 2025 and included blockchain-based applications among its areas of interest. A second cohort opened later in 2025.

Separately, Zanzibar launched a National Blockchain Sandbox in October 2024 through a partnership between the XDC Network and LedgerFi. This initiative focuses on financial inclusion, identity verification, and certification issuance, with government-sponsored training and incubator programs. The BoT has also been conducting research into a potential central bank digital currency (CBDC) since January 2023. The CBDC study was completed in mid-2025, and the Bank is now awaiting government directives on whether to proceed with establishing a legal framework.

Market Characteristics

Adoption Patterns

Despite regulatory uncertainty, Tanzania has seen meaningful cryptocurrency adoption. According to the FinScope Tanzania 2023 Report, 1.7% of adults have invested in cryptocurrencies while 9.7% demonstrate awareness of digital assets. Tanzania reportedly ranks among the top 20 countries globally for crypto adoption. The country’s strong mobile money infrastructure, with widespread use of M-Pesa and similar services, provides a familiar framework for digital financial transactions that may facilitate crypto adoption. An estimated 75 fintech startups currently operate in the country.

Industry Focus

Tanzania’s crypto landscape is primarily driven by peer-to-peer trading and remittances rather than institutional-grade infrastructure or DeFi development. The Zanzibar blockchain sandbox signals interest in enterprise blockchain applications, particularly in trade documentation, identity verification, and financial inclusion. Tanzania’s position as an East African logistics and trade hub, combined with the AfCFTA digital trade initiatives, may create future opportunities for blockchain-based trade facilitation and cross-border payments.

Regulatory Evolution

Tanzania’s regulatory trajectory has accelerated significantly since 2024. The Finance Act’s statutory recognition of digital assets, the launch of multiple sandbox programs, the CBDC study, and the Yellow Card court ruling collectively signal a jurisdiction moving toward comprehensive regulation rather than prohibition. Tanzania’s removal from the FATF grey list in June 2025, after being placed on increased monitoring in October 2022, has strengthened its credibility and may create momentum for financial reform including virtual asset regulation.

Within the East African Community (EAC), Tanzania sits between Kenya’s comprehensive VASP framework (enacted in 2025) and the more limited approaches of Uganda and Burundi. Regional harmonization efforts are underway, with legal experts and industry participants calling for an EAC-level digital asset framework. At the continental level, Tanzania may benefit from the African Continental Free Trade Area’s ADAPT initiative, which is building shared digital infrastructure for cross-border payments using stablecoins and interoperable digital identities.

For Current Information:

• Bank of Tanzania (BoT)
• Capital Markets and Securities Authority (CMSA)
• Tanzania Revenue Authority (TRA)
• Financial Intelligence Unit (FIU)
• Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG)