Austrian financial supervisory authority (FMA) today said it has received applications from 40 prospective digital assets providers, of which 18 entities were granted the regulatory registration.
Crypto firms operating in Austria have to apply for a license to the nation’s financial watchdog as the new Anti-Money Laundering (AML) regulations came into effect. Although derivatives referencing cryptoassets would not fall under this regulation, they remain subject to ESMA’s current restriction and any future proposals by the FMA regarding the sale of these instruments to retail investors.
Until October 2019, crypto service providers had been operating under the transitory provisions set out in the country’s AML Act, which provides a set of rules for those operating a cryptocurrency-related business. Those wishing to continue providing their services in the rising crypto hub, following the expiry of the transitory period, are now required to apply for authorization with the FMA.
In addition to crypto-to-crypto and fiat-to-crypto exchanges, the new rules apply to digital wallet providers, market participants that “exchange one or more virtual currencies against one another, transfer virtual currencies or provide financial services for the issuance and selling of virtual currencies.”
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Hefty Fines for Noncompliance
License applicants must show to the Austrian financial watchdog that they possess sufficient capability, coherence, and solvency to run the business. The legal notice also warns of administrative penalties for failure to comply with the provisions of the FMA rules.
In its capacity to supervise the financial market and enforcing compliance with rules and regulations, the Financial Markets Authority (FMA) of Austria will impose a maximum fine of €200,000 on cryptoasset-related businesses that fail to register with the country’s regulator.
“The FMA pursues a zero-tolerance policy in relation to money laundering and terrorist financing. In relation to the risks associated with virtual currencies, another loophole was closed last year with the introduction of the requirement for companies active in this area to register,” the watchdog said.
The FMA clarified that the majority of digital-asset providers that were applied for its license operate electronic wallets and exchange platforms.