The new regulation for the safekeeping of crypto assets such as Bitcoin requires providers to register with the Austrian Financial Market Authority (FMA). For non-registered companies, however, it could become expensive.
Since January 10, the registration requirement for virtual currency service providers such as Bitcoin has been in effect in Austria. Financial service providers that safe keep crypto-currencies are now subject to supervision by the FMA. This means, among other things, that they must register with the authority. The new rules are anchored in the 5th Money Laundering Directive (AMLD5), which was implemented in Austria in the Financial Market Money Laundering Act (FM-AMLA). Non-registered providers may no longer offer their services in Austria and have to face heavy fines.
Obligation for Bitcoin custodians to report to the FMA
Providers of certain financial services that hold crypto-assets such as Bitcoin are now subject to a reporting obligation. Financial service providers will have to report to the FMA in the future if they include Bitcoin & Co. in their portfolio. These service providers have the obligation, as do “credit and financial institutions, to comply with the due diligence and reporting obligations for the prevention of money laundering and terrorist financing,” the corresponding press release states. The reporting obligation covers the issue and sale of crypto-assets and their transfer, exchange and trading platforms and wallet providers.
Heavy fines for violation
In addition, providers must grant transparent insight into their business structures. The FMA must be notified of any changes in the registered office, managers, and services. If the supervisory authority determines that the criteria of the FM-AMLA are not met or that “the personal reliability of the manager” is not given, the FMA may refuse registration or withdraw an existing registration.
Service providers should not take FMA’s requirements lightly. These are not vague recommendations but clearly defined reporting obligations. In the event of a breach, there is the risk of the most severe sanctions. Non-registered providers are subject to a strict ban anyway. If providers circumvent the reporting obligation, they risk a fine of up to 200,000 euros.
Information on who is subject to registration, how to submit such an application and which documents have to be attached to the application can be found on the FMA website.
Source: BTC-Echo
Liechtenstein, as well as other European countries, are also taking greater action in regulating crypto. In Germany, too, the new law on crypto-custody has been in force since 1 January. Companies that store crypto-assets such as Bitcoin have to register with the German Federal Financial Supervisory Authority (BaFin).
