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Hungary publishes draft law allowing banks to offer crypto services

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Hungary is introducing a legislative proposal that would allow banks, investment funds and asset managers to offer services in Bitcoin and other cryptocurrencies, according to a March 1 report from Bloomberg Law.

The initiative marks a significant development in the Hungarian financial sector, aligning with a broader European movement towards the adoption of digital assets.

If the Hungarian bill passes, it would represent a notable step forward in allowing traditional financial institutions to integrate crypto services. The laws are expected to take effect June 30 if approved.

Law Project

The bill, proposed by the Hungarian Ministry of Economy, aims to create a regulatory framework for digital assets, with the Hungarian central bank serving as the main supervisor.

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

According to Norton Rose Fulbright’s 2024 FinTech Outlook, these regulatory developments are part of a broader trend to recognize the importance of digital currencies in the financial sector.

The Hungarian bill is seen as a response to EU efforts to harmonize regulations on cryptoassets, as the European Securities and Markets Authority (ESMA) continues to consult on the classification of cryptoassets and details of reverse solicitation under MiCA.

EU pushes for regulation

Hungarian legislation reflects a collective European interest in establishing a technologically neutral regulatory framework capable of integrating crypto into the financial system without compromising security or compliance standards.

This could encourage similar legislative efforts across Europe, as countries seek to align with EU directives and foster innovation within their financial sectors.

The potential integration of cryptocurrencies into traditional financial services suggests a shift in investment models, transaction efficiency and broader financial inclusion. Such a change could have considerable implications for the Hungarian economy and possibly influence the European financial landscape.

The inclusion of cryptocurrencies in the offerings of banks and other financial institutions marks a crucial transition to the future of finance.

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