Honduras

Disclaimer: The regulatory information provided below is for general informational purposes only and may not reflect the most current legal developments. Cryptocurrency regulations are rapidly evolving and can change frequently. This information should not be considered legal or tax advice. Before making any business or investment decisions, please consult with qualified legal, tax, or financial professionals familiar with your specific jurisdiction and circumstances. Always verify current regulations with official government sources and regulatory bodies.

Legal Classification & Regulatory Framework

Cryptocurrency Status

Honduras maintains a cautious and restrictive approach toward cryptocurrencies at the national level. The Central Bank of Honduras (Banco Central de Honduras, BCH) has consistently emphasized that cryptocurrencies have no legal backing in the country and are not regulated under Honduran law. According to Article 342 of the Constitution of the Republic of Honduras, the BCH is the sole issuer of coins and banknotes of legal tender in the national territory. The Monetary Law and the Law of the Central Bank of Honduras reinforce this provision, establishing the Honduran lempira as the only legal tender in the country.

The BCH has issued multiple communiqués since 2018 warning the population about the risks associated with using cryptocurrencies. These warnings emphasize that any transaction carried out with crypto assets falls under the sole responsibility and risk of the person conducting it, without protection from national laws or financial authorities. The central bank has been explicit that cryptocurrencies do not enjoy the guarantees or protections granted to legal tender and officially recognized financial instruments.

While cryptocurrencies are not expressly prohibited for private individuals, they exist in an unregulated space. Honduran citizens may hold and trade cryptocurrencies peer-to-peer at their own risk, but these activities lack any legal framework or consumer protection mechanisms. The government’s official position draws a clear distinction between tolerating private use and providing any form of institutional support or recognition.

Tax Treatment

Honduras currently lacks a specific tax framework addressing cryptocurrency holdings, transactions, or mining activities. This regulatory gap creates significant uncertainty for individuals and businesses engaging with digital assets. While there are no explicit capital gains or transaction taxes targeting cryptocurrencies, this absence of regulation does not imply tax exemption.

General tax principles suggest that realized profits from cryptocurrency activities may fall under „other income“ provisions of Honduran tax law, potentially subject to income tax rates of up to 15%. However, the lack of clear guidance means there are no formal reporting requirements specifically for cryptocurrency trading, mining, or other related activities. Tax liability typically arises when tokens are converted to fiat currency, though enforcement mechanisms remain unclear.

This regulatory ambiguity exposes cryptocurrency users to potential future tax risks should authorities decide to implement retroactive or clarifying regulations. Individuals and businesses dealing with significant cryptocurrency volumes should maintain detailed records of their transactions and consult with local tax professionals to understand their potential obligations under existing general tax laws.

Regulatory Oversight

Two primary government bodies shape Honduras’s approach to cryptocurrency regulation. The Banco Central de Honduras (BCH) serves as the primary monetary authority, responsible for maintaining the stability of the national currency and overseeing the payment system. The BCH has been the main source of public warnings and statements regarding cryptocurrency risks and their status outside the legal financial framework.

The Comisión Nacional de Bancos y Seguros (CNBS) functions as the financial sector supervisor, overseeing banks, insurance companies, and other supervised financial institutions. In early 2024, the CNBS took decisive action by issuing Resolution 069/09-02-2024 (also referred to as Circular 003/2024), which prohibits all supervised financial institutions from holding, investing, intermediating, or operating with cryptocurrencies, crypto assets, virtual currencies, tokens, or any similar virtual asset not issued or authorized by the BCH.

This prohibition applies to all entities under CNBS supervision, effectively blocking the integration of cryptocurrency services within the traditional Honduran financial system. The resolution reflects the government’s concerns about potential fraud, operational risks, money laundering, and terrorism financing associated with unregulated digital assets.

Business Environment

Banking Relationships

The banking environment for cryptocurrency-related activities in Honduras is exceptionally restrictive. Following the CNBS resolution, banks, insurance companies, and other supervised financial institutions are explicitly prohibited from any involvement with cryptocurrencies. This includes maintaining crypto holdings, investing in digital assets, providing brokerage services, or facilitating customer transactions involving cryptocurrencies.

This prohibition creates significant barriers for cryptocurrency businesses seeking to operate in Honduras. Companies cannot establish banking relationships for crypto-related activities, and individuals cannot use traditional banking channels to convert between lempiras and cryptocurrencies. As a result, those engaged in cryptocurrency activities must rely on peer-to-peer platforms, offshore exchanges, or informal over-the-counter networks.

The banking restrictions effectively isolate the cryptocurrency ecosystem from the traditional financial system, pushing most activity into informal channels. While the CNBS resolution theoretically allows for exceptions through special licenses granted by the BCH, no such waivers have been issued to date.

Licensing Requirements

Honduras does not currently have a licensing framework for cryptocurrency exchanges, wallet providers, or other digital asset service providers. The absence of such regulations means there is no legal pathway for establishing a licensed cryptocurrency business within the country. No local cryptocurrency exchanges operate with formal authorization, and Hondurans typically access global markets through offshore platforms.

This regulatory vacuum creates a paradoxical situation where cryptocurrency activities are neither explicitly authorized nor entirely prohibited for non-financial entities. Businesses exploring blockchain technology or cryptocurrency-adjacent services must navigate considerable legal uncertainty. Those seeking to incorporate digital assets into their business models must carefully assess risks and may need to structure operations in ways that avoid triggering regulatory concerns.

The Financial Action Task Force (FATF) guidelines, which Honduras follows as a member of the Financial Action Task Force of Latin America (GAFILAT), call for countries to implement registration and licensing requirements for digital asset service providers. This international pressure may eventually push Honduras toward developing a more comprehensive regulatory framework, though no concrete timeline exists.

Innovation Support

Government support for cryptocurrency and blockchain innovation in Honduras remains minimal at the national level. There are no regulatory sandboxes, innovation hubs, or official programs designed to foster fintech development in the digital asset space. The government’s primary engagement with the sector has been through warnings and restrictions rather than facilitation.

The BCH has explored the possibility of developing a central bank digital currency (CBDC), conducting feasibility studies and public consultations on a potential retail digital lempira. However, no final decisions or implementation timelines have been announced. Any future CBDC would operate within the central bank’s framework and would be distinct from decentralized cryptocurrencies.

A notable exception to the restrictive national environment exists in the Próspera ZEDE (Zona de Empleo y Desarrollo Económico), a special economic zone on the island of Roatán. Próspera adopted Bitcoin as legal tender within its territorial boundaries and has recognized Bitcoin as a unit of account for businesses operating within the zone. However, the legal status of Próspera remains contested, as the Honduran government under President Xiomara Castro repealed the ZEDE law and the Supreme Court has declared ZEDEs unconstitutional. Ongoing international arbitration proceedings create uncertainty about the future of this crypto-friendly enclave.

Market Characteristics

Adoption Patterns

Despite the restrictive regulatory environment, cryptocurrency adoption in Honduras continues to grow through informal channels. The country ranks among the top three in Central America for cryptocurrency ownership, following El Salvador and Guatemala. This adoption is driven by several factors, including economic instability, currency devaluation concerns, limited access to traditional banking services, and the potential for cheaper remittance transfers.

Cryptocurrency usage in Honduras tends to concentrate among younger, technologically savvy populations, particularly in urban centers like Tegucigalpa and San Pedro Sula. Grassroots communities have emerged, organizing meetups and educational initiatives to spread awareness about digital assets. Social media platforms, messaging apps like Telegram and WhatsApp, and YouTube channels serve as primary educational resources in the absence of formal programs.

Remittances represent a significant economic factor in Honduras, with millions of citizens receiving money from family members working abroad. Cryptocurrency offers potential advantages for cross-border transfers, including lower fees and faster settlement times compared to traditional remittance services. This use case drives considerable interest in digital assets, particularly stablecoins like USDT that offer price stability.

Industry Focus

The cryptocurrency industry in Honduras remains largely informal and focused on basic trading and holding activities rather than sophisticated financial services. Without a licensing framework or banking access, the ecosystem consists primarily of peer-to-peer traders, over-the-counter dealers operating through social media and messaging platforms, and individuals using international exchanges.

Stablecoins, particularly Tether (USDT), have gained traction for everyday transactions and value storage, while Bitcoin remains popular for longer-term savings. Some innovative developers have created mobile-first applications designed for low-bandwidth environments, enabling cryptocurrency transactions even on basic feature phones. These grassroots solutions address the practical challenges of operating in a country with limited digital infrastructure.

The tourist sector, particularly in areas like Santa Lucia and Roatán, has shown interest in accepting cryptocurrency payments. Initiatives like „Bitcoin Valley“ in Santa Lucia have sought to establish zones where businesses accept Bitcoin alongside traditional currencies, though these remain localized experiments rather than widespread phenomena.

Regulatory Evolution

Honduras’s regulatory approach to cryptocurrency has evolved toward greater restriction rather than accommodation. The progression from general warnings (beginning in 2018) to explicit prohibitions on financial institutions (2024) demonstrates a hardening stance against cryptocurrency integration into the mainstream financial system. This trajectory places Honduras among the more restrictive jurisdictions in Central America.

The contrast with neighboring El Salvador, which adopted Bitcoin as legal tender, highlights the divergent paths Central American nations have taken. While El Salvador has embraced cryptocurrency as a tool for financial inclusion and economic development, Honduras has prioritized financial system stability and risk mitigation, viewing cryptocurrencies primarily as threats rather than opportunities.

Future regulatory developments in Honduras may be influenced by several factors, including international pressure from organizations like GAFILAT to implement FATF recommendations on virtual asset service providers, regional trends in cryptocurrency regulation, the resolution of the Próspera ZEDE dispute, and the outcomes of any CBDC initiatives. However, near-term liberalization appears unlikely given the current government’s approach.

Stakeholders interested in cryptocurrency activities in Honduras should closely monitor developments from both the BCH and CNBS, maintain awareness of any legislative proposals, and stay informed about international regulatory standards that may eventually shape Honduran policy.

For Current Information:

• Banco Central de Honduras (BCH): https://www.bch.hn
• Comisión Nacional de Bancos y Seguros (CNBS): https://www.cnbs.gob.hn