Belarus Legalizes Crypto Banks, Establishes Hybrid Financial System

Belarus has officially legalized crypto banks under a new presidential decree. President Aleksandr Lukashenko signed Decree No. 19 on January 16, 2026, allowing financial institutions to offer both digital asset services and traditional banking products. The move reflects a growing trend toward integrating blockchain technology into established financial systems.

The framework permits High-Tech Park residents to operate crypto banks, combining token-based services with conventional banking. These entities must also be registered in the National Bank's crypto bank registry. The decree establishes a dual supervisory system involving park authorities and the National Bank.

The new rules aim to create a hybrid financial system that leverages the speed and efficiency of blockchain while maintaining regulatory oversight. By integrating digital and traditional banking, Belarus positions itself as a regulated hub for digital finance in Eastern Europe.

Why the Move Happened

Belarus's decision follows years of incremental policy development. In 2017, the country introduced tax exemptions for crypto activities within the High-Tech Park. These incentives encouraged innovation and investment in digital finance. The new decree expands on these policies to ensure a controlled, regulated market.

Regulators aim to prevent the development of an unregulated parallel crypto market. By bringing crypto banking under state supervision, the government seeks to balance innovation with stability. This approach aligns with global efforts to integrate digital assets into existing financial frameworks.

How Markets Reacted

The move was met with positive reactions from market participants. Social media users celebrated Belarus as a forward-thinking jurisdiction. Some posts highlighted the country's potential to attract blockchain startups and investors.

Bitcoin's price rose to around $95,000 shortly after the announcement, indicating strong market confidence. Analysts interpreted the price movement as a bullish sign, reflecting growing institutional interest in digital assets.

What Analysts Are Watching

Experts are monitoring how the hybrid financial system will operate in practice. The dual regulatory structure is expected to ensure that crypto banks provide innovative products without compromising financial stability.

Analysts are also watching whether Belarus can attract international investors. The country's legal clarity and regulatory environment may serve as a model for other nations seeking to integrate digital assets into traditional finance.

Critics caution that the framework places strict limits on crypto operations. For example, crypto banks must maintain full fiat backing, which could restrict the flexibility associated with digital assets. This raises questions about the extent of innovation the new system will support.

The government has extended tax exemptions for crypto operations through January 1, 2025. This policy supports broader participation in the digital finance ecosystem and encourages innovation within the High-Tech Park.

Regulators will now focus on ensuring compliance with the new rules. The National Bank and High-Tech Park authorities will oversee operations, ensuring that institutions adhere to financial and technological standards.