One of the most cryptocurrency-friendly European jurisdictions, Cyprus, could bring regulation of its industry to stricter standards. According to a report from October 10 report According to the Cyprus Mail, the local Ministry of Finance intends to amend the existing Law on the Prevention and Suppression of Money Laundering.
The ministry presented its package of amendments to the Parliamentary Committee on Legal Affairs. Seeks to align Cyprus with international anti-money laundering and counter-terrorism financing (AML/CFT) standards set by the Financial Action Task Force (FATF), as well as with the recommendations of the MONEYVAL report published in November 2022 .
Related: Crypto Adoption in Cyprus Bolstered by Bybit License Approval
Under the amendments, any service provider working with cryptoassets must register with the financial regulator, the Cyprus Securities and Exchange Commission (CySEC). In case of non-compliance, sanctions will range from fines of up to 350,000 euros to prison sentences of up to five years or a combination of both.
The amendments reportedly encountered some reservations from the Cyprus Bar Association, especially regarding the obligation for crypto service providers with operating licenses from other European countries to continue registering with CySEC. This provision was included in the amendments to CySEC itself.
Cointelegraph contacted the Ministry of Finance for more details but did not receive an immediate response.
Crypto companies reported no significant problems when registering their businesses in Cyprus. In September, crypto brokerage firm eToro received a Crypto Asset Service Provider (CASP) CySEC registrationfollowing ByBit, which received the same license in June.
However, the world's largest cryptocurrency exchange, Binance, which operates under increasing regulatory pressure in recent months, decided unsubscribe from the Cyprus market in July. The company said it wanted to focus on larger markets registered in the EU.
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