Hungary’s New Cryptocurrency Regulations
On July 1st, Hungary unveiled a set of stringent regulations governing cryptocurrency, earning the distinction of having some of the tightest controls in the world. This dramatic legislative shift has forced several major financial technology firms to halt their cryptocurrency services temporarily, sparking significant concerns across the fintech landscape.
Impact on Financial Technology Firms
One prominent casualty of this new framework is London-based digital bank Revolut, which announced an immediate suspension of its cryptocurrency offerings in Hungary, home to over 2 million of its users. The company indicated it was working diligently to resume these services, although it did not specify when that might occur. Users will still be able to divest their existing crypto holdings and transfer a limited number of tokens to external wallets, but all new purchases, staking, and recharge operations will be halted during this period.
New Criminal Charges Introduced
The newly enacted laws have introduced two distinct criminal charges: “Cryptocurrency Abuse” and “Providing Unauthorized Cryptocurrency Exchange Services.” According to Hungary’s revised penal code, individuals engaging with unlicensed cryptocurrency trading platforms could face harsh penalties, including potential prison sentences. For straightforward transactions conducted on unauthorized platforms, offenders could receive two years in jail. If the transaction value exceeds 50 million Hungarian forints—approximately $140,000—the prison term could increase to three years, and for amounts over 500 million forints (roughly $1.4 million), the maximum sentence escalates to five years.
Conclusion
This sweeping overhaul of cryptocurrency regulation has generated considerable uncertainty for users and companies alike, raising critical questions about the future of digital asset trading in Hungary.
