Cyprus Tightens Crypto Regulations with Hefty Penalties for Non-Compliance

Cyprus is set to introduce stringent penalties for unregulated cryptocurrency service providers (CSPs), according to the Cyprus Mail. The government has submitted a legislative amendment to the “Prevention and Suppression of Money Laundering Law,” aiming to align the country with international anti-money laundering (AML) and combating the financing of terrorism (CFT) standards. The amendment was presented to the Parliamentary Committee on Legal Affairs on October 10, 2023.

The proposed amendments stipulate that all CSPs dealing with crypto assets must register with the Cyprus Securities and Exchange Commission (CySEC). Failure to comply will result in penalties ranging from fines of up to €350,000 to imprisonment for up to five years, or a combination of both. This move reflects Cyprus’s commitment to minimizing risks associated with money laundering and terrorist financing.

The Cyprus Bar Association has expressed reservations about the amendments, particularly the requirement for CSPs registered in other EU member states to also register in Cyprus. In response, the Ministry of Finance highlighted that monitoring responsibility for such entities initially lies with the state where they are registered.

CySEC is also considering issuing guidelines related to the “Travel Rule” to further enhance regulatory oversight. Discussions are ongoing to ensure the proper and timely implementation of this regulation.

The Travel Rule, originally part of the Bank Secrecy Act in the US, mandates financial institutions to share transaction details with other institutions involved in fund transfers. This rule, adapted for the cryptocurrency industry, aims to prevent money laundering and terrorism financing by ensuring transaction details “travel” with the transfer. In cryptocurrencies, exchanges and wallet providers must share customer information, enhancing transparency and regulatory compliance.

The UK’s Financial Conduct Authority (FCA) has outlined compliance expectations for cryptoasset businesses regarding the ‘Travel Rule’ as well, effective from September 1, 2023. The rule mandates the collection, verification, and sharing of transaction information to align with anti-money laundering and counter-terrorist financing standards.

This development is particularly relevant to Cyprus’ recent regulatory tightening, as both countries aim to align their cryptoasset industries with international standards set by the Financial Action Task Force (FATF).

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Scammers Target Australians in Cryptocurrency Call Center Scheme

It has come to light that people of Australia are the principal targets of a sophisticated multinational network of con artists that operate out of call centers focused on bitcoin. The network is believed to have originated in China. The heart of operations for the network may be found on the continent of Australia. It is commonly believed that the administration of this network is being handled by criminal syndicates that have their headquarters in Israel.

As part of a large-scale operation, law enforcement officers from the countries of Serbia, Germany, Bulgaria, and Cyprus carried out house searches in a total of eleven locations across the country of Serbia, including four call centers. These locations included the country’s capital city of Belgrade. Officials from the island nation of Cyprus were responsible for the operation’s coordination. During the course of this operation, they discovered evidence showing that Australians were among the citizens of all of the other countries who were exposed to the highest degree of examination. This information suggests that Australians were among those subjected to this level of inspection. The material was made available to the general public on February 23 via the dissemination of an article that had been authored by The Australian and published on that day.

Fifteen individuals and about 1.46 million dollars’ worth of cryptocurrencies were seized into custody as a direct result of the operations, which were carried out as a direct consequence of the acts.

It would seem that con artists who work out of these contact centers are using advertisements on social media in an effort to persuade fresh victims into falling for their schemes. They achieve this goal by ensuring prospective investors that any investments they make would result in a significant return on the cash that they have invested. The findings of the research reveal that individuals do engage in this activity, which testifies to the notion that it is prevalent since it indicates that people do participate.


Tagged : / / / / / / / / / / / / / Gets the Greenlight to Operate in Cyprus Through CySEC, a fast-rising exchange platform has secured regulatory approval to operate in the Cyprus crypto market, thereby expanding its European presence. 


The exchange on July 22 says the Cyprus Securities and Exchange Commissions (CySEC) have given it the green light to operate in the space. With this nod from CySEC, can now provide a range of services in Cyprus in accordance with the local regulations.


The approval marks’s commitment to expansion while also complying with native regulators to reach broader customers, especially in Europe. Kris Marszalek, CEO, and co-founder of says Europe is key to the exchange’s expansion plan. 


“Our registration in Cyprus is the next significant step in our continued progress as we expand our products and services to more customers,” Kris noted.


Famed as one of the renowned exchanges serving Web3.0 users, has rigorously pursued its expansion campaign. The CySEC approval follows that of the Hellenic Capital Market Commission in Greece and also Organismo Agenti e Mediatori in Italy.

While it still awaits a full-scale license to operate, has a provisional license to provide its services in Dubai. It also has an in-principle approval for a Major Payment Institution in Singapore. Established in 2016, allows its users to trade over 250 cryptocurrencies including Bitcoin (BTC) and Ethereum (ETH).

Crypto exchanges continue with expansion plans

Despite the bearish run in recent times, several exchanges have continued to strengthen their positions in the European market.  

FTX was approved to operate in Cyprus after it won an operational license from CySEC in March. Although Cyprus continues to see several global exchanges operate on its shores, regulations on cryptocurrencies are still not very clear.

Just last year, the Bank of Cyprus and other major financial institutions were reportedly against transactions in BTC.

The regulators are also trying to increase the oversight of digital assets including cryptocurrencies through the integration of EU anti-money-laundering rules.


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Cyprus’ finance ministry recommends ‘capacity building’ for crypto

Cyprus is moving to regulate the cryptocurrency industry, with the country’s finance ministry releasing a national risk assessment on crypto.

Published on Dec. 13, the official documentation provides a risk assessment for the Republic of Cyprus regarding money laundering risks related to virtual asset activities and virtual asset service providers (VASPs).

The Ministry of Finance of Cyprus stressed that there is a “limited direct understanding or experience” regarding money laundering risks of crypto in the country.

However, authorities like Cyprus Securities and Exchange Commission (CySEC) and local enforcement authorities have demonstrated a “sophisticated level of understanding of the sector,” the statement notes. The authorities should further explore the market and receive “in-depth training on these issues” to enhance their skills, the ministry stated.

The ministry also recommended local financial companies “adopt written policies and procedures to comply” with the wire transfer rule for virtual currencies. In the meantime, authorities should start to maintain and share data that is specific to virtual currencies and VASPs, the ministry said, adding:

“Although activity levels now are believed to be negligible, this will enable an evidence-based baseline as activities increase, promoting earlier detection of risks or changes to risk levels.”

The authority noted that Cyprus should actively collaborate with other jurisdictions experienced in the crypto industry in order to learn from these relationships and identify the best practices.

“Such international cooperation could be an important channel for Cyprus to strengthen and accelerate its capacity building for the VA/VASP sector,” the ministry wrote.

Related: Israel reportedly adopts new AML rules for crypto

One of the world’s most uncertain countries in terms of cryptocurrency regulation, Cyprus has been moving to adopt crypto-related regulations this year. In September, CySEC reportedly disclosed new details of crypto regulation policies, planning to increase cryptocurrencies by integrating European Union’s Anti Money-Laundering rules into the Cypriot laws.

The Cypriot crypto ecosystem is associated with significant uncertainty as some major financial institutions including the Bank of Cyprus were allegedly blocking Bitcoin (BTC)-related transactions this year, according to reports on social media.