The Cyprus Securities and Exchange Commission (CySEC) published a detailed Policy Statement on 13 September 2021, covering the registration process and operations of crypto asset service providers (CASPs).
The Policy Statement followed the CySEC’s first issued Directive for the prevention and suppression of money laundering and terrorist financing (Register of Crypto Asset Providers) which has been amended with some new provisions (the updated Directive in Greek only).
For further details about the requirements for admission to the CASP registry please visit our article “CySEC – Registration of Crypto Asset Service Providers”
Some of the highlights are the following:
- Depending on the corporate structure, crypto assets either qualify as financial instruments under the Investment Services and Activities and Regulated Markets Act or as electronic money under the Electronic Money Act.
- Crypto assets can be a digital representation of value that is not issued or guaranteed by a central bank or public authority.
- CASPs should align their business with anti-money laundering/terrorist financing rules and enforce many obligations such as regulatory and operational requirements. For further details, please check CySEC’s Policy Statement which outlines the rules for CASPs.
- CySEC approach on territorial scope:
- CASPs operating from Cyprus must be registered with CySEC in order to be able to provide services and/or perform activities in relation to crypto-assets and will be regulated by CySEC.
- EEA domiciled CASPs who are registered with the competent authority of the respective Member State for the relevant services and/or activities and who as per Section 61E(2)(b) of the AML/CFT Law are exempted from the obligation to be registered with CySEC when providing services and/or undertaking activities in relation to crypto-assets in Cyprus, must submit to CySEC a notification form providing sufficient evidence in relation to their registration with the said EEA competent authority, before they commence their operations in Cyprus.
- CASPs registered in a Third Country, must be registered with CySEC in order to be able to provide services and/or perform activities, in relation to crypto-assets in Cyprus and will be regulated by CySEC.
CySEC has announced the new developments related to CASPs with a Press Release on 13 September 2021 where it has also announced to the public its dedicated webpage for CASPs applicable rules and procedures. The Application forms for the authorisation process have been announced to the public and are expected to be published soon.