What Law 25-10 Actually Criminalized
Algeria’s relationship with cryptocurrency has always been restrictive: the 2018 Finance Law contained vague discouraging language, but enforcement was inconsistent and penalties were unclear. Law 25-10, published in Official Journal No. 48 and enacted on July 24, 2025, ended that ambiguity. Article 6 bis now explicitly outlaws the issuance, purchase, sale, storage, and promotion of digital assets. Critically, the law goes further than most comparable jurisdictions: even possessing a private key, operating a cryptocurrency wallet, hosting a blockchain node, or publicly discussing the benefits of cryptocurrency can constitute a criminal offense.
The enforcement structure is coordinated across five institutional pillars:
- Bank of Algeria — central oversight of the national financial framework
- Banking Commission — ensures commercial banks block all crypto-related transactions
- Financial Authorities — monitor money flows and detect crypto-to-fiat conversions
- Security Authorities — conduct digital surveillance and physical raids on mining operations
- Judicial Authorities — prosecute violations through formal court proceedings
No transitional period or amnesty window was provided. Existing crypto holders were not offered a wind-down grace period. The law is active and enforceable as of its enactment date.
Why Compliance Is Now a Full Institutional Responsibility
Before Law 25-10, a Algerian bank could arguably claim that vague 2018 guidance didn’t require a formal compliance program for cryptocurrency risk. That argument is no longer available. The law’s alignment with FATF (Financial Action Task Force) standards — explicit in its legislative framing — means that international correspondent banks will now scrutinize Algerian institutions for documented crypto-compliance programs, not just the absence of obvious violations.
Algeria is also working to complete its FATF action plan and transition out of increased monitoring. In that context, every bank and fintech in Algeria that operates with weak AML procedures is a liability — not just for itself, but for Algeria’s broader effort to demonstrate systemic compliance to international supervisors. The Banking Commission’s mandate to ensure commercial banks “block crypto transactions” makes this not just a best-practice question but a supervisory directive.
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A Four-Pillar Compliance Framework for Algerian Banks and Fintechs
1. Customer Due Diligence — Screening for Indirect Crypto Exposure
Law 25-10’s scope is broader than most compliance teams have modeled. The standard requires that screening identify “any detected crypto involvement, whether direct or indirect.” This means customer due diligence workflows must flag not only clients who self-identify as cryptocurrency users, but also clients whose transaction patterns suggest indirect exposure — for example, frequent wire transfers to crypto-friendly jurisdictions, receiving funds with exchange payout patterns, or communications that reference digital asset activity.
The standard of review is conservative: even a client who claims their activity is “educational” or “software testing” must be escalated if the transaction pattern matches known crypto indicators. Banks should update KYC questionnaires to include a direct crypto disclosure question and add negative screening logic in their core banking systems that flags incoming transfers from exchanges operating in jurisdictions where crypto is legal.
2. Transaction Monitoring — Detecting the Patterns Law 25-10 Targets
Standard transaction monitoring rules built for AML purposes need extension to detect crypto-specific patterns. The indicators that enforcement bodies are watching for include: incoming wire transfers from crypto-friendly jurisdictions with exchange payout naming conventions, peer-to-peer transfer patterns consistent with decentralized finance (DeFi) activity, VPN usage patterns that suggest access to foreign crypto trading platforms (detectable through IP and device data for mobile banking customers), and conversion sequences that suggest crypto-to-fiat channeling through third-party accounts.
Fintechs operating payment infrastructure are especially exposed here because they sit closest to the transaction layer. Payment service providers (PSPs) that process bulk consumer transactions should implement rule-based alerts for the above patterns, reviewed by a named compliance officer with documented escalation authority to the Banking Commission.
3. Prohibited Activity Controls — Vendor and Partner Screening
The five enforcement categories in Law 25-10 include operating exchanges, wallet services, and blockchain node hosting — activities that can involve third-party vendors rather than the institution itself. A bank that uses a cloud provider or software vendor with cryptocurrency-related products anywhere in its portfolio may technically be in a gray area. Compliance teams should review all technology vendor contracts to confirm that no vendor service touches digital asset infrastructure.
For fintechs with API-connected partner ecosystems — payment rails, embedded banking, open banking integrations — a vendor attestation requirement should be added to contracting. Each partner should formally confirm it does not facilitate cryptocurrency transactions or provide infrastructure to crypto businesses operating in Algeria.
4. Documentation and Regulatory Reporting — Building the Audit Trail
The Banking Commission’s oversight mandate, combined with Algeria’s FATF obligations, means that compliance programs must be documented, not just operational. Banks and fintechs should maintain written records of: CDD decisions on crypto-flagged customers (whether escalated, rejected, or cleared with rationale), transaction monitoring alerts and disposition records, vendor attestations confirming absence of crypto exposure, and staff training logs for crypto-compliance procedures.
These records should be retained for a minimum of five years, consistent with Algeria’s existing AML record-keeping standards. The Financial Intelligence Processing Unit (CTRF) — Algeria’s financial intelligence unit — receives suspicious activity reports, and crypto-related escalations should be filed there under the existing suspicious transaction reporting framework, not held internally.
The Structural Lesson for Algerian Compliance Leaders
Law 25-10 is not primarily a consumer protection law — it is a systemic AML tool. Algeria’s legislative approach addresses cryptocurrency risk through outright prohibition rather than regulatory containment (the approach taken by Singapore, the EU, and other jurisdictions that have licensed virtual asset service providers). The prohibition model simplifies the compliance logic: the answer to every crypto question is the same (no), but it creates a surveillance burden that the containment model avoids.
The compliance lesson is this: prohibition regimes require stronger institutional documentation of how the prohibition is enforced, not less. International correspondent banks — particularly those in Europe and the Gulf that are subject to FATF-aligned AML rules — will review Algerian counterpart compliance programs as part of their own correspondent due diligence. An Algerian bank that cannot produce a documented crypto-compliance framework is a risk for its correspondent, regardless of whether it has actually processed any crypto transactions. The documentation requirement is the price of operating in a prohibition regime with active international banking relationships.
The four-pillar framework above — CDD, transaction monitoring, vendor controls, and documentation — is the minimum credible standard for 2026. Compliance officers who have not yet updated their AML manuals to reflect Law 25-10’s specific prohibitions should treat that update as a Q2 2026 priority.
Frequently Asked Questions
What exactly does Law 25-10 prohibit, and does it apply to businesses that never dealt in crypto?
Law 25-10 prohibits the issuance, purchase, sale, storage, and promotion of all digital assets — including possession of a private key, operation of a cryptocurrency wallet, and hosting of blockchain nodes. It applies to all entities in Algeria’s financial system, including those that have never directly handled cryptocurrency. If a vendor or partner ecosystem includes cryptocurrency-adjacent activity, the institution may have indirect exposure under the law’s broad prohibition language.
What are the penalties for individuals and institutions that violate Law 25-10?
Individuals face prison sentences of 2 months to 1 year and fines of 200,000 to 1,000,000 Algerian dinars (approximately $1,540–$7,700 USD). Aggravated cases — where violations connect to organized crime, money laundering, or terrorist financing — carry substantially higher penalties. Institutional liability is enforced through the Banking Commission, which can escalate findings to judicial authorities for prosecution.
How should fintechs handle customers who already had crypto holdings before the law was enacted?
Law 25-10 provided no transitional period or amnesty window. Customers who held cryptocurrency positions prior to July 24, 2025, are not exempt from the prohibition. Fintechs and banks should treat any customer who discloses prior or ongoing crypto activity as a suspicious transaction case requiring immediate escalation to the Financial Intelligence Processing Unit (CTRF) and a documented CDD decision. Continuing to service such customers without escalation creates institutional liability.
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Sources & Further Reading
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