Is Crypto Legal In Azerbaijan?

Cryptocurrency is legal in Azerbaijan, though it is not recognized as legal tender and currently lacks comprehensive regulation. The country operates without specific legislation governing virtual currencies, meaning trading and mining activities are not prohibited by law (1). The Central Bank of Azerbaijan acknowledges the dual functionality of virtual assets as both investment vehicles and transactional mediums, and is actively working on developing a regulatory framework to integrate them securely into the financial ecosystem.

A draft law to regulate virtual assets in Azerbaijan is currently being prepared and represents one of the Central Bank's key priorities. Fidan Tofidi, Director of the Financial Technologies and Innovations Department at the Central Bank of Azerbaijan, confirmed during the Baku Fintech Forum 2025 that preparations are underway for implementation of virtual asset regulations (2). The Central Bank plans to work more closely with the market, with preparations for a new strategic phase beginning next year, demonstrating the government's commitment to establishing a comprehensive governance structure for digital assets.

"In our capacity as the Central Bank, we acknowledge the dual functionality of virtual assets as both investment vehicles and transactional mediums, necessitating a robust framework for their secure integration into the financial ecosystem."

While awaiting formal legislation, cryptocurrency earnings in Azerbaijan are subject to taxation under existing tax laws, as individuals who earn income are required to pay taxes regardless of the source. The Central Bank's monetary policy has historically incorporated considerations for blockchain technology and virtual currency circulation (1). Cryptocurrency users and businesses must comply with anti-money laundering requirements enforced by the Financial Monitoring Service, which mandates Know Your Customer procedures and digital verification processes to prevent illicit activities in the crypto space.

Source:
https://www.trend.az/business/4062159.html
https://report.az/en/finance/central-bank-announces-development-of-bill-on-virtual-assets

Last updated: 18-10-2025 Disclaimer: This article does not provide legal advice. If you need legal advice, please contact an attorney directly.