Botswana Regulator Issues Stern Warning on Unlicensed Virtual Asset Operations
The Non-Bank Financial Institutions Regulatory Authority (NBFIRA) of Botswana has issued a critical advisory to the public, urging extreme caution against engaging with unlicensed Virtual Asset Service Providers (VASPs), including online platforms. This directive underscores the growing regulatory scrutiny of the virtual asset landscape and its implications for businesses and investors operating within or looking to enter the sector.
In a move that highlights the enforcement of the Virtual Assets Act, 2025, NBFIRA has published a list of fully compliant and licensed VASPs. These entities have met the stringent requirements of the Act and are currently operating without compliance issues. The authorised providers include: Yellow Card Botswana (Pty) Ltd, Express Minds (Pty) Ltd, Temtum Services (Pty) Ltd, Kalahari Exchange (Pty) Ltd, Lebebe Au & Bc (Pty) Ltd, Xago Technologies (Pty) Ltd, and Transkalahari Advisory Group (Pty) Ltd.
The regulatory action is grounded in specific provisions of the Virtual Assets Act, 2025. Section 9 of the Act unequivocally states that “A person shall not carry out or participate in a virtual asset business, unless the person is the holder of a virtual asset service provider license issued in terms of section 11…”. This legal framework establishes a clear mandate for all virtual asset businesses to obtain official licensing before commencing operations.
Furthermore, NBFIRA has emphasised the severe penalties for non-compliance. Section 36 of the Act stipulates that any individual or entity conducting virtual asset business in contravention of the law commits an offence. Such offenders are liable, in instances where no specific penalty is prescribed, to a substantial fine not exceeding P1,000,000, imprisonment for a term not exceeding 10 years, or both. This serves as a stark reminder to legal counsel, compliance officers, and corporate executives of the significant legal and financial ramifications of operating outside the regulatory perimeter.
The Authority’s advisory explicitly warns that utilising any VASP not listed among the authorised providers exposes consumers to considerable risks. These risks encompass potential financial losses, susceptibility to fraud, and the critical absence of regulatory protection, leaving individuals and businesses without recourse in the event of disputes or operational failures. For legal professionals advising clients in the fintech and virtual asset space, this directive necessitates a thorough due diligence process to ensure all counterparties are properly licensed and compliant with Botswana’s regulatory framework. Investors and business leaders are similarly advised to verify the licensing status of any VASP before committing capital or entering into agreements.
NBFIRA encourages the public to exercise vigilance and to report any suspicious activities or unlicensed operations. For verification purposes or to report non-compliance, individuals and entities can contact NBFIRA directly via telephone at +267 3686100 / 3102595, email at info@nbfira.org.bw, or through their official website at www.nbfira.org.bw. This proactive stance by NBFIRA aims to foster a secure and regulated environment for virtual asset transactions in Botswana, protecting stakeholders and promoting market integrity.
