Too Tough? Poland’s New Crypto Law Faces Pushback

Poland’s lower house has approved a wide-ranging crypto bill that would put the country’s entire virtual asset market under stricter state control. Based on reports, the measure — known as Bill 1424 — passed the lower house of Poland’s national parliament, or Sejm, with 230 votes in favor and 196 opposed.

The law would give the Polish Financial Supervision Authority, KNF, sweeping powers over exchanges, issuers and custodians operating in or serving customers in Poland.

What The Law Requires

According to coverage, the draft compels all Crypto Asset Service Providers to obtain a KNF license to operate in the market. It would set detailed rules on capital, internal controls, anti-money-laundering safeguards and risk management.

Penalties are heavy: operating without a permit could draw fines up to 10 million złoty (about US$2.8 million) and, in some versions, criminal liability including up to two years in prison for serious breaches. Existing firms would get a six-month window to apply for authorization once the law takes effect.

Supporters Say It Brings Clarity

Backers argue the move will align Poland with the EU’s Markets in Crypto-Assets rules and give clearer rules to investors and businesses.

Clarity is meant to reduce scams and make large players feel safer about doing business in Poland. Some observers say stronger oversight could attract institutional money that has been wary of unclear local rules.

But many in Poland’s crypto community warn the bill goes further than EU minimums and could burden smaller players. Reports point to concerns about high costs and heavy paperwork that might push startups to move operations abroad.

There is also worry the KNF’s review process could be slow; some sources claim decisions might take as long as 30 months, creating an uncertain climate for firms that need speed to survive. Artists, small issuers and hobbyist projects fear that strict rules will squeeze out low-budget activity.

The draft would also require more disclosures from issuers and service providers. Regulators could maintain a register of unpermitted domains and use tools to block access. Supporters say this helps fight fraud. Critics say it risks overreach and could limit legitimate users’ access to services.

Based on reports, after clearing the Sejm the text is moving to the Senate for review. President Karol Nawrocki has been reported to consider a veto unless certain provisions are softened, particularly those that introduce criminal penalties and broad supervisory powers.

Lawmakers and industry groups are pressing for amendments that would narrow the scope of some requirements and ease costs for smaller operators.

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