Does Anyone Regulate Cryptocurrency

Contrary to the conventional currency, Financial institutions or monetary authorities cannot issue a cryptocurrency. Market supply and requests determine prices. The cryptocurrency landscape continues to change at a worrying rate. It may be difficult to follow. Different rules apply to various countries or jurisdictions. But, is anyone regulate Cryptocurrency?

In the EU Parliament, for instance, has not passed any specific legislation on cryptocurrencies. Although cryptocurrencies are generally legal, regulations for cryptocurrency exchanges depend on the individual member states of the EU.

There’s also a difference in cryptocurrency taxation, there are some member states that charge capital gains tax on cryptocurrency-derived profits. The Court of Justice of the European Union decided that cryptocurrency exchanges of traditional currencies should be exempt from VAT in 2015.

Let’s look at the regulations and rules that apply to cryptocurrencies and related entities.

Is Cryptocurrency Trading Regulate?

At the moment, cryptocurrency exchanges do not have a European regulation. The EU did however agree to the Fifth Money Laundering Directive (5MLD) in April 2018. This directive create with the objective of bringing cryptocurrency-fiat currencies under the EU’s anti-money laundering legislation.

In January 2020, the 5AMLD became effective. In an attempt to address the Directive, some Member States created a framework where exchanges must register with their regulators.

For instance, Germany’s Financial Supervisory Authority (BaFin), France’s Autorite des Marches Financiers (AMF), Italy’s Ministry of Finance, or Luxembourg Commission de Surveillance du Secteur Financier (CSSF). These regulators grant authorization that allows companies to operate under local AML legislation. These authorizations, unlike full licenses, are not transferable across the EU.

The EU in April 2018 agreed on the text of the Fifth Money Purgence (5ml). It was created to allow cryptocurrency-fiat currency exchanges to be brought under the EU’s anti-money laundering legislation.


The new Payment Service Directives (PSD2) & Global Data Protection Regulation (GDPR) must be adhered to by crypto exchanges falling under the European Economic Area’s (EEA).

The PSD2 regulations will require Strong Customer Authentication (SCA) for all electronic transactions, which means that 2-factor authentication required when you purchase crypto using fiat currency. This is done to reduce fraud and increase trust in the payment system. PSD2 applies only to transactions that use a credit card or debit card. It does not apply to crypto-to-crypto transactions.

GDPR, a law that focuses on data privacy and protection in the EU is mandatory for EU/UK-based crypto exchanges. Users must now give permission to exchanges before they can do anything with their data. All entities are now required to respect the privacy of users and their data.

Crypto service provider, becoming a ‘compulsory entity,’ is now subject to the same Aml regulation requirements as banks and other financial institutions. They also have to register with financial authorities. Is the service provider that regulate Cryptocurrency.

The European Commission clarified. EU clarified that these new actors will need to identify customers and report suspicious activity to the Financial Intelligence Units. The UK FCA has stated clearly that all crypto exchanges, ATMs and peer-to-peer platform providers, custodian wallet providers, and token issuers must adhere to its rules, including initial coin offerings and initial exchange offerings.

The Austrian Financial Market Authority (FMA), announced it was the regulator for virtual currencies in Austria. The FMA must register by all companies that trade, issue, transfer, trade, or exchange cryptocurrencies. These include custodian wallet service providers and in-kind crypto arbitrage. Registers will adhere to the reporting and due diligence obligations in order to prevent money laundering. This is also true for many other member countries.


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