The government of Estonia has recently introduced a draft legislation that will bring stringent regulation for crypto assets providers, Bloomberg reported citing the Finance ministry of the country. The drafted legislation awaits parliamentary approval. It has been developed to create a conducive business environment without stopping crypto users from owning and exchanging cryptocurrencies.
The Finance Ministry assured that Estonia would not ban cryptocurrencies. In order to pacify the concerns of investors, Estonia has come up with the revised draft regulation.
The ministry explained that the amendments in the revised draft legislation transpose the recommendations issued by the Financial Action Task Force on Money Laundering (FATF) into Estonian law, as the FATF defines certain virtual asset services that are not covered under Estonia’s current legislation.
The new rules for the crypto sector would ensure the following things, according to Finance Ministry:
* Mitigating risks of financial crimes through crypto platforms registered and operating out of the Baltic nation.
* The regulation mandates crypto companies to operate in or be connected to Estonia in order to obtain its licenses.
* The new regulations require the virtual asset service providers ( VASPs) to identify their customers in a way that would link them to their transactions.
* The legislation will not affect individuals who own virtual currency through a private wallet that is not provided by a VASP.
* It does not prohibit customers from holding and trading virtual assets and does not require them to share private keys to their crypto wallets.
* Estonian service providers will not be allowed to offer anonymous accounts or wallets.
* An increase in share capital requirements for VASPs from €12,000 to €125,000 or €350,000, has also been allowed depending on the type of services.
Estonia granted cryptocurrency licenses in 2017 for doing business in the sector. Currently 400 licensed crypto companies operate in the country.
(For the latest crypto news and investment tips, follow our
