The Estonian government does not ban cryptocurrency.
The proposed regulation contains the most recent international AML/CFT requirements, which apply to crypto service providers licensed in Estonia but do not propose additional client protections.
The Estonian Ministry of Finance issued an official statement of the recently submitted draft law that sparked concerns about a cryptocurrency prohibition.
According to the rebuttal, the law, which still requires three readings in parliament, was prepared and presented in an attempt to strengthen the existing crypto service provider license and would not impact people who hold and trade cryptocurrencies.
The official rebuttal reads:
“The regulation is not applied to customers, but to virtual asset service providers (VASPs) who conduct activities for or on behalf of natural or legal person as a permanent business. This means that the legislation does not contain any measures to ban customers from owning and trading virtual assets and does not in any way require customers to share their private keys to wallets,”
According to the Ministry of Finance, the new rule, which is still subject to legislative scrutiny, will not impact people who possess crypto through a private wallet that a VASP does not offer.
According to the proposed legislation, only enterprises operating in or related to Estonia can apply for a VASP license, although present regulations enable licensed companies to be resold to other parties.
The increased capital requirements are another significant change that will affect smaller VASPs.
VASPs will be required to have a minimum share capital of 125 000 or 350 000 euros, depending on the type of service given, up from the present floor of 12 000 euros.
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