Cyprus, one of the most crypto-friendly European jurisdictions, may be making its industry regulation more stringent. According to October 10 a report By Cyprus Mail The local Ministry of Finance intends to amend the current Law on the Prevention and Suppression of Money Laundering.
The Ministry presented its amendment package to the Parliamentary Legal Affairs Committee. It seeks to align Cyprus with the international standards for anti-money laundering and countering the financing of terrorism (AML/CFT) established by the Financial Action Task Force (FATF), in addition to the recommendations of the MONEYVAL report published in November 2022.
Related: Cryptocurrency adoption in Cyprus has been boosted by Bybit’s license approval
Under the amendments, every service provider working with crypto assets must register with the financial regulatory body, the Cyprus Securities and Exchange Commission (CySEC). In the event of non-compliance, penalties will range from fines of up to 350,000 euros to imprisonment of up to five years or a combination of both.
The amendments were reportedly met with some reservations from the Cyprus Bar Association, especially regarding the obligation of cryptocurrency service providers with representative licenses from other European countries to continue to register with CySEC. This provision has been included in the amendments made by CySEC itself.
Cointelegraph reached out to the Ministry of Finance for further details, but did not receive an immediate response.
Cryptocurrency companies have reported no major problems registering their businesses in Cyprus. In September, crypto-friendly broker eToro obtained Crypto Asset Service Provider (CASP) registration from CySEC, following ByBit, which obtained the same license in June.
However, Binance, the world’s largest cryptocurrency exchange, which has been operating under increasing regulatory pressure in recent months, decided to deregister on the Cyprus market in July. The company said it wants to focus on the larger markets registered in the European Union.
magazine: The truth behind the Bitcoin revolution in Cuba: an on-the-ground report