Hungary has passed laws that could slap individuals trading crypto using an unauthorized crypto exchange with prison.
Those who use a so-called âunauthorized crypto-asset exchange serviceâ could face up to two years in prison with penalties increasing based on the value traded, according to an update to the countryâs Criminal Code that came into force on July 1.
Hungary Tightens Laws For âUnauthorizedâ Crypto Trading
Hungary has updated its Criminal Code, imposing potential prison sentences for those using or running unauthorized crypto exchanges.
The updated laws also target unauthorized crypto service providers with up to three years in prison, which could increase depending on the value of illicit trades.
Local news outlet Telex reported on July 1 that the laws have confused crypto companies serving the country, as Hungaryâs Supervisory Authority for Regulatory Affairs (SZTFH) has 60 days to develop compliance frameworks for the laws, but no guidance exists in the meantime.
New Law For âAbuse Of Crypto-Assetsâ
The first update to Hungaryâs Criminal Code gives a penalty of up to two years in prison if an unauthorized crypto exchange is used to trade between 5 million to 50 million forints ($14,600 to $145,950).
That penalty rises to up to three years if the offence is of âa particularly large valueâ between 50 million and 500 million forints ($145,950 to $1.46 million).
A highlighted excerpt of Hungaryâs updated Criminal Code with the new penalties for using unauthorized crypto exchanges. Source: National Legislation Database of Hungary
Offences over 500 million forints can carry a penalty of up to five years.
âUnauthorizedâ Crypto Exchanges Now A Criminal Offence
The second updated law around crypto gives up to three years in prison for those who provide unauthorized âcrypto-asset exchange service activitiesâ of up to 50 million forints ($145,950).
The penalty increases are similar to the unauthorized exchange use laws, with crypto service providers hit with up to five years in prison for offences up to 500 million forints ($1.46 million) and up to eight years in prison for offences over 500 million forints.
Revolut Pulls, Then Reinstates Some Crypto Services
Earlier this month, local outlet Portfolio reported that the UK-based fintech company Revolut pulled its services in Hungary over the laws.
A section of Revolutâs Hungarian site said it had stopped all crypto-related services in the country â including withdrawals from the platform â due to ârecently introduced Hungarian legislation,â and did not have a timeline for when it would reinstate the services.
However, Portfolio reported on Monday that Revolut had again allowed crypto withdrawals only. Revolut also said its EU arm is working on gaining a crypto license within the EU.
