On 17 September 2025, a bill introducing amendments to the Organic Law of Georgia “On the National Bank of Georgia” was submitted to the Georgian Parliament (the Amendments). The bill is currently pending its first reading. If adopted in its proposed form, the amendments will introduce a comprehensive regulatory framework for virtual asset service providers (VASPs) in Georgia, significantly expanding the oversight powers of the National Bank of Georgia (NBG).
This article will outline the key proposed changes and assess their practical compliance implications for VASPs and other stakeholders within Georgia’s financial and virtual asset sector.
Expanded Definition of Virtual Asset Services
The Amendments propose to amend the definition of virtual asset services. According to the proposed text, virtual asset services encompass:
- Exchange of convertible virtual assets (including through self-service kiosks) for national or foreign currency, other virtual assets, or financial instruments;
- Transfer, storage, and administration of convertible virtual assets or instruments enabling control over them;
- Management of portfolios consisting of convertible virtual assets (excluding collective portfolio management);
- Administration of trading platforms for convertible virtual assets;
- Lending of virtual assets;
- Initial offerings of virtual assets and related services;
- Any other virtual asset services defined by the normative acts of the National Bank of Georgia.
Most of the listed services were already covered under the existing law. The key novelty introduced by the amendment is “Any other virtual asset services defined by the normative acts of the National Bank of Georgia.” This change authorizes the NBG to define new virtual asset services independently through normative acts, thereby enhancing the regulatory scope and allowing the law to adapt to emerging activities in the virtual asset sector.
Clarified Existing Authorities
The Amendments codify and emphasize powers the NBG was already authorized to exercise over VASPs, ensuring these established practices are explicitly detailed in the law:
- Registration, Deregistration, and Oversight: NBG’s core function of supervising all VASP activities, including managing the mandatory registration and deregistration processes, remains central. This includes the authority to conduct inspections, issue instructions, and impose restrictions.
- Transparency of Ownership and Capital: Requirements for full transparency regarding capital origin and ownership are reaffirmed. VASPs must continue to disclose the identity of all direct and beneficial owners holding significant shares. NBG retains its existing right to request and scrutinize this documentation;
- Enforcement and Sanctioning Powers: NBG’s crucial role in enforcing compliance with Anti-Money Laundering (AML), Counter-Financing of Terrorism (CFT) regulations, and international financial sanctions is underlined. This includes the pre-existing powers to impose sanctions and restrict or terminate certain VASP activities.
- Operational and Governance Standards: The Amendments formally clarify the NBG’s long-standing authority to define and set conditions for VASP operations, reinforcing its power to enforce standards such as: (i) suitability criteria for VASP administrators and management; (ii) risk management frameworks and comprehensive internal control systems; and (iii) mandatory cybersecurity standards to ensure consumer protection and system integrity.
Mandatory Capital Requirements
One of the most significant new elements is the introduction of minimum supervisory capital requirements. The NBG will have explicit authority to determine the minimum capital VASPs must hold and establish the methodology for its calculation, including requirements related to virtual assets. It is crucial to note that no such capital requirements currently exist for VASPs in Georgia, and the specific thresholds and calculation methods will be detailed through forthcoming subordinate normative acts.
Explicit Consumer Protection Measures
Under the proposed changes, the NBG will have explicit authority to establish rules dedicated to the protection of consumer rights in relation to VASPs. This may include mandating the provision of necessary information to consumers and ensuring a higher degree of transparency in the delivery of virtual asset services.
Implementation and Regulatory Timeline
The Amendments require the NBG to issue all relevant subordinate normative acts—which will detail the specific implementation of operational standards and capital requirements—by September 1, 2026. By this date, VASPs operating in Georgia should have full clarity regarding the new, precise compliance obligations, allowing for the necessary operational and financial adjustments.
In summary, while the foundation of VASP regulation remains rooted in prior NBG authority, the Amendments formalize a more robust, stable, and consumer-focused regulatory environment. VASPs and stakeholders must proactively monitor the development of the forthcoming subordinate acts to ensure full compliance and successful long-term operation within this enhanced framework.
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