Estonia's Crypto Evolution: New Regulations Forge Path Forward for Digital Finance
Mar 22, 2024
The Estonian government has passed a bill aimed at regulating cryptocurrency service providers, pending a parliamentary vote. Under the proposed legislation, these providers would fall under the oversight of the Financial Supervision Authority (FSA), a departure from their current registration with the Financial Intelligence Unit (FIU). Compliance with Anti-Money Laundering (AML) regulations would remain mandatory. If enacted, the FSA will begin issuing licences in 2025, with existing FIU licence holders required to apply for FSA licensing by the end of that year. Estonian Finance Minister Mart Võrklaev expressed confidence in the licensing process, emphasising that serious service providers should secure the necessary licences. The bill also introduces increased fines for AML violations, potentially reaching up to 5 million euros, compared to the current maximum of 40,000 euros. Aligning with the EU's Markets in Crypto-Assets (MiCA) regulations and modifying securities prospectus requirements are among the bill's objectives. Estonia's history as a crypto-friendly jurisdiction, established in 2017, has seen adjustments to regulations, including tightened measures in 2020 following a non-crypto-related corruption scandal.
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