In Estonia, cryptocurrency companies are currently only subject to anti-money laundering regulations. However, a new bill will require Estonia to comply with the Markets in Crypto-Assets (MiCA) regulation. The Estonian government has approved a bill to regulate cryptocurrency service providers. This legislation mandates that cryptocurrency service providers be regulated by the Financial Supervisory Authority (FSA). Currently, cryptocurrency service providers are registered by the Financial Intelligence Unit (FIU) and must comply with anti-money laundering (AML) rules. According to legislation, the FSA will begin issuing licenses in 2025, and holders of FIU licenses must apply for FSA licenses by the end of that year.
Under national law, fines for violating anti-money laundering laws can reach up to 40,000 euros (43,450 US dollars). However, under the new law, fines of up to 5 million euros (5.2 million US dollars) can be imposed.
Estonian Minister of Justice Maris Lauri stated that he sent the bill to the government last week, and the bill has not yet been translated into English. The bill must be approved by the government before it can be submitted to the Estonian unicameral parliament, Riigikogu, for a vote.
The bill will bring Estonia into compliance with the European Union's Markets in Crypto-Assets (MiCA) regulations. In addition to regulating cryptocurrency service providers, the bill will also change the requirements for prospectuses. Previously, companies wishing to raise funds in the form of stocks or bonds worth more than 5 million euros had to prepare a detailed prospectus, but the threshold will now be raised to 8 million euros (8.69 million US dollars).
Estonia positioned itself as a cryptocurrency-friendly country in 2017 when it passed legislation to provide favorable laws for cryptocurrency companies and streamline registration, including e-residency. However, in 2020, following a massive corruption scandal unrelated to cryptocurrency, the government cracked down on cryptocurrency companies. Estonia revoked licenses for 500 cryptocurrency companies issued by financial intelligence institutions because they failed to launch operations in the country within six months of registration.
After several months of review by the police, the number of cryptocurrency companies licensed in Estonia decreased from 1,234 at the end of 2019 to 353 in September 2020. In October 2021, the Financial Intelligence Unit considered revoking all cryptocurrency licenses and reissuing business licenses. It implemented stricter anti-money laundering requirements at the end of 2021. After the law was revised in 2023, nearly 400 virtual asset providers were closed or voluntarily closed.
This new regulatory bill will further standardize Estonia's cryptocurrency market and align it with relevant EU regulations. As the Estonian government intensifies its regulation of the cryptocurrency industry, market participants will need to comply with stricter regulations and standards. This will also help improve market transparency and investor protection.
The Estonian government's regulatory stance on cryptocurrency companies will continue to be closely watched, especially against the backdrop of evolving global trends in digital asset regulation. As the regulatory environment changes, cryptocurrency companies will need to continually adjust their compliance measures to adapt to changing regulatory requirements and provide users and investors with a safer, more transparent trading environment.
For more analysis, please follow Aibit's media account for real-time updates! This article is for reference only, does not represent any position, and is not intended as investment advice. Investment is risky, caution should be exercised.
Facebook: https://www.facebook.com/aibitcom
X: https://twitter.com/aibitcom
Telegram (CN): https://t.me/aibitcom_cn
Telegram (EN): https://t.me/aibitcom
Telegram (Announcements): https://t.me/aibitcom_announcements
Discord: https://discord.com/invite/aibitcom
Medium: https://medium.com/@aibitcom
Youtube: https://www.youtube.com/@aibitcom