The Polish crypto market does not have a comprehensive regulative system, although it is interpreted by the law. Hence, the digital currency does not belong to the domain of the financial market within the interpretation of Polish law, so basically it is not in the remit of a specific, traditional financial regulation. Though the Polish government may carry out regulation over the activities consisting of the delivery of payments, which could refer to particularly digital currency field, there is no directed control by authorities over activities in terms of the issuing and buying/selling crypto assets. But, since 2021 cryptocurrency trading in Poland has been encompassed in the remit of Polish law, which entails a plethora of requirements for this market participants.
Status of cryptocurrency in Poland
As there is no direct provision of Polish law that clearly limits the activity in terms of digital currency, we can come to the conclusion that such activity is legally allowed. Since being under the supervision, it may be conducted once the entrepreneur acquires an appropriate license.
If consider the status of digital assets in detail, the EU legislative system does not stipulate any banning in this term, which was noted in the judgment of the Court of Justice of the EU (C-264/14). The Court informed that digital currency executes a function of the means of payments and that the payments covering digital currencies are free from a value-added tax.
Crypto-services regulation in Poland
The Polish legit framework sets up a range of rules imposed on the organizations acting in the domain of digital currency such as:
- exchange crypto/fiat and vice versa,
- exchange crypto/crypto,
- managing accounts that give authorized persons the possibility of using digital currency.
Licensing under Polish legislation
To begin the provision of the offerings connected to the digital money it is necessary to acquire legal permission – a crypto license. The core obligations an entity is expected to follow are the following:
- Formation of a company with a “physical” office;
- Setting up a bank account and contributing of initial capital;
- Hiring staff members and directors with an appropriate experience and education in the financial sector;
- Drawing up a plan for the company activities, and documentation package on hardware and software used for exchange activities;
- Drawing up internal and external policies for executing AML / KYC standards, internal registers, control regulations, etc.
It is required to ensure a clear framework for the company’s scope of operations. The process may be a bit red-taped but it can be performed well. Also, it is important to learn local peculiarities. For instance, the Polish government necessitates that crypto entrepreneurs and holders must declare crypto-related gains separately from other incomes.
Crypto license requirements
An entity doing business in the scope of payments (covering cryptocoins) is expected to fulfill two specific requirements:
- no criminal conviction requirement,
- professional qualification requirement.
Only the entities which satisfy both requirements by confirmed by relevant documents will be enlisted to the register of activities in the domain of crypto coins.
Post-licensing obligations
Once an entity successfully passed the procedure of registration and acquiring a license, it must adhere to a range of post-licensing obligations stipulated in Polish law, in particular, it must:
- determine and estimate the ML/TF risks relating to its operation;
- carry out the financial security measures (Know Your Client procedure);
- ongoing monitoring of the customer’s business relations;
- develop an internal procedure for counteracting ML/TF risks;
- inform state officials about the particular transactions;
- cooperate with state officials in a case of criminal suspicion.
If you have questions in terms of cryptocurrency trading in Poland, please contact us in any way that is convenient for you – we are always at your service.
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