FIN-FSA granted LocalBitcoins Oy, NorthCrypto Oy, Prasos Oy, Prasos Cash Management Oy, and Tesseract Group Oy registration as virtual currency providers. From November 01, 2019, only virtual currency providers who fulfill the requirements provided by legislation may practice activities in Finland. FIN-FSA stipulates that only registered virtual currency providers provide such services in Finland. If a virtual currency provider does not comply with the requirements, its activities will be prohibited and the FIN-FSA will impose a fine on the provider. Registration and supervision bring virtual currency providers under the scope of anti-money laundering regulation.
The directive on the prevention of money laundering and terrorist financing is now extended to cover virtual currency providers throughout EU. Even though the requirement for the registration and supervision of virtual currencies is based on EU regulations, registration granted by a national competent authority of a member state does not give the service provider authorization to provide services in other EU member states. The registration process requires significant effort from the applicants, for example, concerning customer due diligence and written documentation of activities. Virtual currencies are high-risk investments, despite the registration obligation. The risks include extreme and abrupt price volatility, information security threats on exchange platforms and wallet providers and the fact that many virtual currencies are used as speculative investments.
Virtual currency providers are not subject to statutory risk management and capital adequacy requirements. The regulation and supervision of virtual currency providers is not as comprehensive as that of other financial sector entities. The provision of virtual currencies is an international and cross-border activity. Finnish investors in virtual currencies may, therefore, use services provided by a virtual currency provider operating from another country.
Related Link: Press Release
Keywords: Europe, EU, Finland, Banking, Securities, Virtual Currencies, AML, Registered Virtual Currency Providers, FIN-FSA
Previous ArticleBDE Publishes Circular on Accounting Regime of Credit Institutions
The European Banking Authority (EBA) proposed implementing technical standards on the interest rate risk in the banking book (IRRBB) reporting requirements, with the comment period ending on May 02, 2023.
The U.S. Federal Reserve Board (FED) set out details of the pilot climate scenario analysis exercise to be conducted among the six largest U.S. bank holding companies.
The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.
The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.
The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.
The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.
The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.