You only have a minute? Here are 3 takeaways from the article
• As of July 6, Croatia has a comprehensive regulatory framework for the registration of Virtual Asset Service Providers (VASP) or commonly known as cryptocurrency exchanges.
• The new laws follow the European Markets in Crypto-Assets (MiCA) Regulation, which is expected to come into force between mid-2024 and early 2025.
• Experts point out that this could also make Croatia an “El Dorado” for crypto companies.
The new regulations stipulate the conditions under which a VASP can be registered in the VASP register, what documents a VASP must attach to the application for registration and what reports VASPs are required to send to regulators on an annual or monthly basis.
The statutes that were promulgated by the country’s financial regulator HANFA earlier this month will also aim to harmonize existing regulations with ongoing technological development and growing demand for crypto assets.
Industry experts point out that this could make Croatia the ideal place to register a crypto company in the EU and an attractive destination for the latest crypto rush.
“I expect that HANFA’s statutes will make Croatia THE ideal place to register a crypto company in the EU. One of the reasons is surely the passport system similar to that of banks, which allows a company to transfer its license from one EU country to all others,” Vlaho Hrdalo, lawyer and president of the Croatian Union for Blockchain and Cryptocurrencies (UBIK). , tells The Recursive.
However, before a crypto rush arrives in Croatia, the existing industry itself now faces a tougher challenge: how to adapt and stay compliant.
“The existing crypto industry in the country is currently adjusting its documents to remain compliant. But they must also be on alert, because the very good statutes adopted by HANFA will attract strong competition. Croatia is a perfect entry country to the EU now that we have introduced the euro as a currency,” adds Hrdalo about a possible crypto rush.
Although the industry’s views were taken into account when developing the legislation, the adjustment will not be an easy process, the business community points out.
“Complying with all the new laws will certainly not be an easy process, both financially and operationally, especially for smaller crypto businesses due to the administrative obligations imposed by these statutes. This could cause existing small businesses to cease their crypto operations, or new ones to simply abandon their planned projects,” Nikola Skoric, founder and CEO of the Croatian cryptocurrency brokerage and payments broker. Electrocointells The Recursive.
Further development of the Croatian crypto industry
Recently, Croatia also saw one of its largest crypto companies, Bitlucky, collapse and cause an alleged loss of $15 million in customer assets – which subsequently led to a police investigation. investigation in the question. It is hoped that the new regulation will also serve to prevent such cases in the future.
According to Skoric, these statuses represent the most important steps for the further development of the crypto industry in the country.
“They will provide a clear set of rules and guidelines for both regulators and crypto-related companies, as well as transparency in the eyes of customers (which leads to greater trust in the crypto industry). cryptography). We believe that these changes, if well understood and implemented, could encourage the Croatian crypto industry to continue developing and grow even more,” adds Skoric.
Furthermore, the new regulations initially attracted the attention of many non-Croatian projects – and could cause a change in the balance of the local industry itself.
“We are already seeing an increase in the number of non-Croatian projects contacting us to register in Croatia and consequently move their business to Croatia. This also means that banks will no longer have the possibility to refuse to open a bank account to these companies, because they will now be licensed, which will eliminate the argument used so far by banks,” highlights Hrdalo.
So far it is unclear how the country’s regulators intend to manage this development, as they follow the European MiCa regulation, which establishes the legal framework for the sector for the first time at EU level and will be directly applied in all member countries. countries.
“Companies are betting that they will not be required to do anything else once MiCA comes into effect if they follow this process now (which is indeed a well-founded assumption),” Hrdalo concludes.