Spain: Here are the latest regulatory requirements for crypto-exchanges

Spain: Here are the latest regulatory requirements for crypto-exchanges

Spain’s central bank is all set to roll out the new registration process for crypto-exchanges by September-October. Exchanges, along with crypto-asset custody platforms and wallets, will be required to register with authorities in order to comply with legal requirements. This, the institution believes, will address transparency and terrorism financing issues.

The aforementioned steps are mandated by the Prevention of Money Laundering and Financing of Terrorism Law. It was passed by the Spanish parliament last year. Subsequently, this provision was included in Royal Decree-Law 7/2021. It gives a period of six months for the implementation of the registry from its entry into force ie., from 29 April to 29 October. The law states that the purpose is to,

“Improve the mechanisms for the prevention of terrorism and improve the transparency and availability of information about true cryptocurrency owners.”

Once the procedure with instructions and the necessary forms to request registration in the new registry is released by the Bank, entities will have until January 2022 to send in their applications. Acceptance in the registry will be based on the implementation of anti-money laundering and anti-terrorist financing measures. Along with AML protocols, digital asset service providers should also meet the central bank’s “commercial and professional” compliance requirements.

Further, persons involved in providing services related to the “exchange of virtual currency for legal tender” will be subject to “preventive obligations.” Moreover, the registry will be connected to those of other countries in the European Union. It will also be available to the public for viewing in a bid to increase transparency.

A proactive regulatory environment

Spanish authorities and lawmakers have been spending considerable time regulating the cryptocurrency industry lately. Earlier this year, the Spanish tax agency stepped up its monitoring of cryptocurrency usage by mandating both citizens and residents to declare their cryptocurrency holdings, even those held on overseas-based platforms.

Moreover, Spain’s National Securities Market Commission (CNMV) recently issued warnings against Huobi and Bybit, along with several others, for operating without a license. Registered entities need to be authorized to offer securities-related services in Spain.

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