A draft proposal has been introduced in Armenia that would allow cash transactions in the crypto-assets sector to continue for up to one year, with a limit of 300,000 drams. The initiative was announced by former Minister of Justice Arpine Hovhannisyan.
She recalled that in recent years the authorities have consistently promoted the reduction of cash circulation. This policy was presented as an effective tool to combat corruption, the shadow economy, and crime. The Ministry of Internal Affairs was among its main advocates. The approach also applied to crypto-assets.
Under the planned regulation, the Central Bank was expected to begin licensing crypto-related activities in January 2026. All such operations were to be moved entirely into the cashless domain. This policy was framed as part of the fight against illegal drug trafficking, human trafficking, and financial crimes.
Drug trafficking and crypto transactions
Hovhannisyan noted that, according to official data from the Ministry of Internal Affairs, around 300 Telegram-based shops currently operate in Armenia. These shops are involved in the illegal sale of drugs.
Based on unofficial estimates, each platform conducts an average of six to seven transactions per day. The value of these transactions starts at around 20 dollars and can reach 300, 500 dollars, or more.
According to conservative calculations, the annual turnover of this illegal market amounts to approximately 13–14 million dollars.
Why the proposed decision raises questions
“The illegal drug trade is largely conducted through cryptocurrencies. In particular, Dash is widely used. Its traceability is limited and significantly restricts the capabilities of law enforcement agencies,” Hovhannisyan said.
She added that against this background, the proposal to allow cash transactions in the crypto sector for another year appears, at the very least, illogical from the perspective of state policy.
Hovhannisyan stressed that if restricting cash circulation is truly a key instrument in combating drug trafficking, corruption, and organized crime, then the necessary steps should have been taken as soon as possible to enforce these limitations.
Conflicting signals from state institutions
“But what do we see in reality?” she asked. “From January 1, 2026, the Central Bank is supposed to launch licensing, and banks should switch to cashless crypto operations. Just two weeks ago, both the Ministry of Internal Affairs and the Central Bank said they were firm and would not change course.”
She noted that representatives of the crypto community have presented what they consider legitimate arguments. These include references to sanctioned funds and the need to stimulate economic activity. Hovhannisyan said she does not wish to take a position on those arguments.
“The problem lies in the logic of state decisions,” she emphasized.
Questions about lobbying and interests
According to Hovhannisyan, it is unclear why two diametrically opposed positions were voiced within such a short period. While the Ministry of Internal Affairs insists on its original stance, the Central Bank has introduced a draft allowing cash transactions up to 300,000 drams for another year.
“As a result, several important questions arise,” she concluded. “Who lobbied for the discussion and adoption of this project? And who stands to benefit from it?”