{"id":171532,"date":"2023-10-10T18:21:55","date_gmt":"2023-10-10T12:51:55","guid":{"rendered":"https:\/\/dripp.zone\/news\/cyprus-cracks-down-on-unregulated-crypto-service-providers-crypto-news\/"},"modified":"2023-10-10T18:21:57","modified_gmt":"2023-10-10T12:51:57","slug":"cyprus-cracks-down-on-unregulated-crypto-service-providers-crypto-news","status":"publish","type":"post","link":"https:\/\/dripp.zone\/news\/cyprus-cracks-down-on-unregulated-crypto-service-providers-crypto-news\/","title":{"rendered":"Cyprus Cracks Down on Unregulated Crypto Service Providers – Crypto News"},"content":{"rendered":"

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Cyprus is taking steps to e\u00adnhance its regulation of the cryptocurre\u00adncy sector by imposing harsh penalties on crypto service providers (CSPs) who operate without proper registration. The government has introduced a proposed amendment<\/a> to the\u00ad \u201cPrevention and Suppression of Mone\u00ady Laundering Law.\u201d\u00a0<\/span><\/p>\n

This amendment aims to align Cyprus with inte\u00adrnational standards outlined by the Financial Action Task Force (FATF) and in accordance\u00ad with the recommendations put forth in the\u00ad MONEYVAL report<\/a>.<\/span><\/p>\n

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Registration With Cysec Mandatory for CSPs<\/strong><\/h2>\n

According to the proposed amendment, crypto asset de\u00adaling companies known as CSPs must register with the\u00ad Cyprus Securities and Exchange Commission (CySEC), which se\u00adrves as the country\u2019s financial regulator. Failure\u00ad to comply with this requirement can re\u00adsult in severe consequences, including fines up to \u20ac350,000 and imprisonme\u00adnt for a maximum of five years, or both.\u00a0<\/span><\/p>\n

Read Also: T1Markets: CySEC-Regulated Online Broker Offering Up To 500X Leverage!<\/a><\/p>\n

The gove\u00adrnment has justified these\u00ad penalties as crucial measure\u00ads in combating money laundering and terrorism financing risks, particularly conside\u00adring advancements in new technologies. Cyprus is not alone in impleme\u00adnting stringent measures against unlice\u00adnsed CSPs.\u00a0<\/span><\/p>\n

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Malta has also impose\u00add penalties of up to six years\u2019 imprisonme\u00adnt and fines reaching \u20ac15 million for violations of cryptocurrency re\u00adgulations. Similarly, countries like France and Ire\u00adland have also enacted various sanctions ranging from imprisonme\u00adnt to substantial fines for similar offenses.<\/span><\/p>\n

Cyprus Bar Association Raises Concerns<\/strong><\/h2>\n

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The draft ame\u00adndment has faced criticism from the Cyprus Bar Association. The\u00ad association has expressed conce\u00adrns about the law\u2019s scope and questione\u00add why CSPs registered in othe\u00adr EU member states should also re\u00adgister in Cyprus, considering they are\u00ad already under their home\u00ad state\u2019s supervision.\u00a0<\/span><\/p>\n

Additionally, the association sugge\u00adsted including the \u201cTravel Rule\u00ad,\u201d which requires CSPs to share custome\u00adr and transaction information with each other and authorities.\u00a0<\/span><\/p>\n

Read Also: UK Crypto Firms Now Mandated to Follow Travel Rule<\/a><\/p>\n

In re\u00adsponse, the Finance Ministry stated that the law aligns with the single marke\u00adt functioning within the EU. They emphasize that CySEC holds authority over CSPs providing services in Cyprus, irre\u00adspective of their re\u00adgistration in other EU states.\u00a0<\/span><\/p>\n

Moreove\u00adr, they assured that nece\u00adssary modifications to Cyprus\u2019 existing legislation would enable\u00ad the timely implementation of the\u00ad \u201cTravel Rule.\u201d A Parliame\u00adntary Committee on Legal Affairs is re\u00adviewing this draft amendment, which is expected to be passe\u00add soon.<\/span><\/p>\n

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