Cyprus’ Ministry of Finance recommends “capacity building” for cryptocurrencies

Cyprus is in the process of regulating the cryptocurrency industry and the country’s Treasury Department is releasing a national risk assessment on cryptocurrencies.

The official documentation released on December 13 provides a risk assessment for the Republic of Cyprus in relation to money laundering risks related to Virtual Asset Activities and Virtual Asset Service Providers (VASP).

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

Cyprus’ Ministry of Finance recommends “capacity building” for cryptocurrencies
Cyprus’ Ministry of Finance recommends “capacity building” for cryptocurrencies

But still, Authorities such as the Cyprus Securities and Exchange Commission (CySEC) and local inspection and control authorities have demonstrated a “thorough understanding of the sector”.says the statement. Authorities should continue to explore the market and receive “in-depth training on these topics” to improve their skills, the ministry said.

The ministry also recommended that local financial firms “put in place written policies and procedures to comply with the virtual currency bank transfer rule”. In the meantime, authorities should start maintaining and sharing VASP and virtual currency-specific data, the ministry said, adding:

“While activity levels are now viewed as negligible, this will allow for an evidence-based baseline as activity increases, encouraging earlier identification of risks or changes in risk levels.”

The agency noted that Cyprus should actively work with other jurisdictions with experience in the cryptocurrency industry to learn from these relationships and identify best practices.

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

Cyprus, one of the most insecure countries in the world when it comes to regulating cryptocurrencies, has moved on to adopting crypto-related regulations this year.. In September, CySEC reportedly revealed new details of cryptocurrency regulatory policy and planned to increase cryptocurrencies by incorporating European Union anti-money laundering rules into Cypriot laws.

Cyprus’ crypto ecosystem is fraught with significant uncertainty, as reports have shown that several large financial institutions, including the Bank of Cyprus, have blocked Bitcoin (BTC) -related transactions this year.

Similar Posts