Hungary technically revised its Criminal Code as a way of strictly penalizing individuals engaging in unlawful cryptocurrency trading. The state stated that the new legislation targets any person utilizing or running crypto exchanges without proper licensure or registration.
This act of parliament came into force on July 1 and prescribes variable sentences of imprisonment according to values of crypto transactions. This is with the aim of boosting regulation of financial operations concerning digital currency as well as subjecting any such platforms in Hungary to transparency.
They who operate on unlicensed crypto exchanges in the range of 5 million – 50 million forints face imprisonment of up to two years. In local currency, it is equivalent to $14,600 – $145,950 per range and targets retail investors of small sizes or unlicensed persons.
If any such person trades with such illicit websites with values in between 50 million and 500 million forints, they will have no choice but suffer three years in jail. Such values fall roughly in between $145,950 and $1.46 million and will most likely have implications on big players or institutions.
Unlicensed Crypto providers pace strict penalties
The parliamentarians of Hungary have also handled high-value offenses in which crypto transactions exceed 500 million forints in total. These kinds of serious offenses can result in five years maximum imprisonment with any individual using unlicensed crypto exchanges.
Furthermore, unlicensed operators of crypto trade risk facing three years imprisonment as a result of turnovers of 50 million forints. Authorities increase fines for trades over 500 million forints and hand out a maximum sentence of eight years imprisonment to operators.
Hungary’s Supervisory Authority of Regulatory Affairs (SZTFH) has been given a 60-day window to develop a framework of regulations. However, crypto businesses already operating in Hungary are in no clear way aware of how they can conform with this legislation right away.
Revolut, a financial tech firm, initially suspended its crypto operations in Hungary following the recent legislative revision last week. It then reopened crypto withdrawals as it applies for a crypto license under its EU entity.
The action follows rising worldwide focus on regulation of decentralized finance as well as on cracking down on unlicensed digital currency activity. Regulators seek to infuse this rapidly expanding financial sector with greater order as well as accountability.
