: Cyprus is contemplating hefty fines of up to $350,000 for unregistered crypto service providers, with individuals behind such firms potentially facing up to five years in prison. The proposal aims to align the country’s regulations with international standards set by the Financial Action Task Force.
Cyprus is contemplating imposing substantial fines on crypto firms that operate without proper registration, with penalties potentially reaching $350,000 for these entities. Individuals responsible for such unregistered firms could face up to five years in prison. The proposal, which aligns with international standards established by the Financial Action Task Force (FATF), is included in a draft submitted to the Parliamentary Committee on Legal Affairs by the country’s Finance Ministry.
To avoid penalties, crypto entities in Cyprus must register with the Cyprus Securities and Exchange Commission (CSEC). This requirement applies not only to entities based in Cyprus but also to those licensed by other European Union (EU) states and those yet to be licensed. The Finance Ministry consulted the Cyprus Bar Association before submitting the draft, incorporating FATF’s travel rule into the law, but the association expressed reservations about the need for entities already registered elsewhere in the EU to register in Cyprus.
The CSEC is also exploring the possibility of issuing guidelines to enhance its oversight of the crypto sector.