Hungary Releases Draft Digital Assets, Allows Banks to Offer Cryptocurrency Services

The bill aims to create a comprehensive regulatory framework for digital assets.

According to a March 1 report on Bloomberg Law’s website, Hungary is moving forward with a legislative proposal that would enable banks, investment funds and asset managers to offer bitcoin and other cryptocurrency services.Bitcoin Miner

The move marks an important development in Hungary’s financial sector and is in line with broader moves toward digital asset adoption across Europe.

If approved, the Hungarian bill would represent a significant advancement in the ability of traditional financial institutions to integrate cryptocurrency services. If approved, the laws are expected to come into force on June 30th.

Draft Legislation

The draft legislation was proposed by the Hungarian Ministry of Economy and aims to establish a regulatory framework for digital assets with the Hungarian central bank as the primary regulator.

The move signals Hungary’s efforts to comply with EU regulatory standards, including the Market Regulation of Crypto Assets (MiCA) and stricter anti-money laundering and counter-terrorist financing measures.ETC Miner

According to Norton Rose Fulbright’s Fintech Outlook 2024 report, such regulatory developments are part of a broader trend toward recognizing the importance of digital currencies in the financial sector.

Hungary’s bill is seen as a response to the EU’s efforts to harmonize crypto-asset regulation, when the European Securities and Markets Supervisory Authority (ESMA) continues to consult on the details of crypto-asset classification and reverse solicitation under MiCA.

The EU is pushing for regulation

Hungary’s legislation reflects a shared commitment by European countries to create a technology-neutral regulatory framework that can integrate cryptocurrencies into the financial system without compromising security or compliance standards.

The move could encourage similar legislative efforts across Europe, as countries aim to align with EU directives and promote nurturing innovation in their financial sectors.

The integration of cryptocurrencies into the services of banks and other financial institutions marks a crucial shift in the future of finance. Such a change could have far-reaching implications for the Hungarian economy and could affect the landscape of European finance.