Poland’s Crypto-Asset Market Act: Industry Concerns Grow

TLDR

• Poland’s Sejm approved the Crypto-Asset Market Act, regulating the country’s crypto market.
• The law introduces strict licensing requirements for crypto service providers operating in Poland.
• The bill aligns Poland’s crypto regulations with the EU’s MiCA framework.
• Crypto service providers must submit detailed applications to the KNF to obtain a license.
• Non-compliance with the new regulations could result in fines up to 10 million zlotys or prison terms.

Poland’s Sejm has approved the Crypto-Asset Market Act, a new law regulating the country’s crypto market. This legislation introduces strict licensing requirements for crypto asset service providers (CASPs). The bill, which now moves to the Senate, aligns with the European Union’s MiCA regulation, a framework aimed at regulating crypto across the EU.

New Regulatory Framework for Crypto Providers

The Polish government passed the bill, aiming to align crypto regulations with EU standards. It requires all crypto service providers in Poland to obtain a license from the country’s financial supervision authority, KNF. CASPs, both domestic and foreign, will need to provide comprehensive details about their operations, including corporate structure and Anti-Money Laundering (AML) procedures.

These regulations will directly affect crypto exchanges, issuers, and custody providers. The law mandates that they submit a detailed application to secure the necessary license. If passed, CASPs will have six months to comply with the new regulations or face possible cessation of operations.

Potential Consequences for Non-compliance

The Crypto-Asset Market Act also introduces criminal liability for violations. This includes potential fines of up to 10 million Polish zlotys ($2.8 million) and prison terms of up to two years. Such penalties have raised concerns among critics, especially within the crypto community.

The law’s introduction has generated significant opposition. Some lawmakers have voiced concerns that the legislation will stifle innovation and harm Poland’s crypto sector. They argue that the law is overly restrictive, especially considering the lengthy process for obtaining a license from the KNF.

Poland’s Crypto Law Faces Opposition from Key Figures

Janusz Kowalski, a member of the opposition Law and Justice (PiS) party, criticized the bill, calling it “overregulation.” Kowalski argued that it could harm Poland’s crypto market, which is home to three million crypto holders. He also noted that the bill is excessively lengthy compared to similar legislation in other EU countries like Germany and the Czech Republic.

Tomasz Mentzen, a blockchain advocate, echoed these concerns. He highlighted the KNF’s slow regulatory processes, with an average application processing time of 30 months. Mentzen warned that this delay could lead to the destruction of blockchain and stablecoins in Poland.

Poland’s new crypto law has sparked a wider debate about the country’s approach to digital assets. Despite the support from some political figures, there is considerable uncertainty surrounding its potential impact. Critics, including Tomasz Mentzen, are calling on the Senate and President Karol Nawrocki to veto the bill to protect Poland’s crypto ecosystem.

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