Cyprus To Introduce Stricter Cryptocurrency Measures, Recommend Penalties

By enacting severe fines for breaking new regulations, the Republic of Cyprus plans to improve its management of the cryptocurrency industry. The government says that this action results from its efforts to strengthen the legal framework governing cryptocurrencies and guarantee the security and integrity of the cryptocurrency sector within its borders.

It is gathered that there have been many significant features aimed at enhancing transparency, accountability, and regulatory oversight in the cryptocurrency sector that will be introduced by the proposed changes to Cyprus’ regulatory framework for cryptocurrencies.

One of the significant aspects of these changes is the need for cryptocurrency service providers (CSPs) to register with the Cyprus Securities and Exchange Commission (CySEC). This registration aims to put CSPs under CySEC’s regulatory control and subject them to the same guidelines that apply to conventional financial institutions.

Failure to comply with this registration obligation will carry serious consequences, such as a sizable fine of up to €350,000 or a lengthy sentence of up to five years in jail. These severe fines highlight the government’s dedication to ensuring that CSPs operating in Cyprus uphold the highest standards of compliance and security.

Cyprus Government Solicit Feedback From Stakeholders, Propose Legislative Adjustments

The report has it that at the moment, Cyprus has aggressively solicited feedback from many stakeholders, including the Cyprus Bar Association, to ensure the proposed revisions are accurate and fair. However, some of this government’s efforts to unify the modifications and address stakeholder concerns have provoked debate.

According to the proposed change, CSPs with current licenses from other EU member states must register with CySEC to conduct business in Cyprus. The administration looks set to move forward with the legislative changes despite the misgivings the Cyprus Bar Association and others voiced, highlighting the significance of harmonizing Cyprus’ crypto sector with EU standards and laws.

The changes are intended to improve consumer protection, stop illegal activity, and promote a safe and well-regulated environment for Bitcoin users and businesses. Meanwhile, Industry experts like Daily Coin’s Brian Danga believe these suggested changes would be a big step toward striking that balance and guaranteeing Cyprus’s bitcoin business grows responsibly.

Cyprus Ministry Of Finance Awaits  Parliamentary Amendment For Approval

A wider tendency across EU member states to improve their regulatory frameworks for cryptocurrencies is seen in tightening oversight and adopting harsher sanctions for non-compliance. As a way of fostering uniformity and safeguard consumers throughout the European Union, the EU has aggressively pursued a thorough regulatory framework for cryptocurrencies and digital assets.

According to a report from Cyprus’s Cyprus Mail on the 10th of October, the planned amendments will ready the country to adopt the popular “MONEYVAL report,” which was published sometime in November 2022 alongside the global regulatory standards developed by the renowned Financial Action Task Force (FATF).

The modalities are said to be used as anti-money laundering measures in the country. The newspaper also reported that the government is implementing these measures to align local cryptocurrency supervision with global standards.

Cyprus is also said to be working on amending its already existing “Prevention and Suppression of Money Laundering Law” as part of the modification process. However, this development is coming at a time when the Cyprus Ministry of Finance presented the planned parliamentary amendment to the country’s Parliamentary Committee on Legal Affairs for approval.