Cyprus to Introduce Tough Penalties for Unregistered Crypto Companies
Cyprus is planning to impose strict penalties on cryptocurrency companies that fail to register with local authorities. According to a report from The Cyprus Mail, the government is considering fines of up to €350,000 and imprisonment for up to five years for non-compliance with the country’s regulations. The move is aimed at aligning Cyprus with international standards set by the Financial Action Task Force (FATF) in the fight against money laundering.
Registration Requirement for Crypto Companies
Under the proposed amendments, crypto companies such as exchanges and hedge funds will be required to register with the Cyprus Securities and Exchange Commission (CySEC). However, the exact implementation date of these changes remains unclear. Cyprus is not alone in its efforts to regulate the crypto market, as many countries are tightening their regulations to prevent illicit activities like money laundering and fraud.
FATF Urges Adoption of Travel Rule
In June 2023, FATF called on countries to adopt and implement the “Travel Rule” as a crucial measure against money laundering and terrorism financing through cryptocurrencies. Out of 98 jurisdictions, only 29 have met the requirements, with only a small subset taking enforcement actions.
Hot Take: Cyprus Takes a Stand Against Unregistered Crypto Companies
Cyprus is cracking down on unregistered crypto companies by introducing strict penalties for non-compliance. This move demonstrates the country’s commitment to aligning with international anti-money laundering standards set by FATF. By requiring crypto companies to register with CySEC, Cyprus aims to enhance its control over the crypto market and prevent illicit activities like money laundering and fraud. These regulatory efforts mirror those of other countries around the world that are tightening their grip on crypto asset service providers. With FATF urging the adoption of the Travel Rule, it is clear that global authorities are prioritizing the regulation of cryptocurrencies to safeguard financial systems.
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