Authorities in Belgium have obliged providers of some crypto exchange and wallet services to register with the country’s financial watchdog. Targeted platforms that fail to comply with the new regulations will face fines, among other penalties, including prohibition to carry out their respective activities.
Financial Regulator Imposes Mandatory Registration for Crypto Exchange Service Providers in Belgium
Starting from May 1, 2022, any legal entities established and operating in Belgium that want to provide exchange services between “virtual currencies and legal currencies” are required to register with the Financial Services and Markets Authority (FSMA), the country’s financial regulator. The same applies to companies offering custody wallet services, the agency announced.
Cryptocurrency platforms falling under these two categories, which had been working in Belgium before the specified date, should notify the FSMA of their activities before July 1, 2022 and apply for registration prior to a Sept. 1 deadline, the watchdog said. They will be granted “provisional authorization” allowing them to continue operations until the FSMA reviews their registration requests.
The affected service providers are Belgian or European companies. The registration is subject to a minimum capital requirement of €50,000 ($53,000), a FAQ section on the authority’s website details. The FSMA also wants to know the identities of the shareholders and the persons in control of the platforms who must have the necessary management qualities.
The FSMA notes that by exchange service providers it means entities carrying out purchase or sale transactions using own capital. That’s when the provider acts as a counterparty to a deal, just like traditional currency exchange offices.
Platforms that serve as intermediaries in transactions between a client and a third party are not targeted with the new rules. However, operators of automated teller machines (ATMs) for crypto-fiat exchange, will be considered as providers of exchange services for the purposes of the new requirements.
The regulator also defines custodial wallet services as services for the custody of private cryptographic keys on behalf of clients for the purpose of holding, storing, and transferring virtual currencies. Persons offering customers such services will be viewed as custodial wallet service providers that need to register with the FSMA.
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Do you think most crypto service providers in Belgium will be able to meet the new requirements and register with the country’s financial watchdog? Tell us in the comments section below.
Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.
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