Poland discusses new crypto laws

The Polish parliament is expected to debate up to five bills on cryptoassets on May 12. The Sejm's provisional agenda includes proposals from the government, President Karol Nawrocki and MPs from various parliamentary groups. The aim of the drafts is to transpose the EU Regulation on Markets in Cryptoassets (MiCA) into Polish law. The process had been delayed after Nawrocki blocked two earlier government initiatives. Prime Minister Donald Tusk stated last week that the government would now submit its crypto bill to parliament for the third time. The new proposal differs above all in terms of tougher penalties for people who commit fraud and expose the Polish state to risks, Tusk said. Dispute over account freezes and penalties The drafts of the government and the president differ primarily in terms of the powers of the Polish financial supervisory authority KNF and the level of possible penalties. The government proposal stipulates that the KNF can request a crypto service provider in writing to block a crypto or cash account for up to 96 hours. The prerequisite would be a reasonable suspicion of a breach of certain MiCA rules. In addition, the KNF could extend the blocking of a cash or cryptoasset account for up to six months or suspend individual transactions if this is necessary to protect trading security or the interests of crypto investors. The President's draft retains the 96-hour period, but limits a possible extension to three months. It would also require prior approval from an administrative court. The explanatory memorandum states that greater judicial control should ensure the legality of administrative decisions. There are also differences in the penalties. The Ministry of Finance's draft bill provides for the penalty for obstructing or preventing inspections to be increased from PLN 20 million to PLN 25 million. The President's draft leaves it at PLN 20 million. Investigations increase political pressure Regulation of the crypto market has taken on added urgency after the Polish public prosecutor's office launched an investigation into possible fraud against the crypto exchange Zondacrypto in April. According to previous information, the case involves up to 30,000 users who are said to no longer have access to their funds. The confirmed losses amount to at least PLN 350 million, the equivalent of around USD 97 million. The public prosecutor's office is investigating possible fraud, mismanagement and theft. Zondacrypto CEO Przemysław Kral is reported to have traveled to Israel. His Israeli citizenship could complicate the proceedings, as Israel generally does not extradite its own citizens. Kral had previously publicly confirmed the existence of an inaccessible cold wallet in which client funds were allegedly stored. He did not comment publicly after that. The exchange's difficulties date back to 2022. At that time, founder Sylwester Suszek disappeared. He is said to have taken the private keys needed to access company reserves. His family suspects that Suszek was killed. Kral denies the theft and attributes the collapse to a liquidity crisis that was exacerbated by technical problems after Suszek's disappearance. The public prosecutor's office has not yet accepted this explanation and refers to suspicious transactions and declining reserves before the freezing of payments. The Polish authorities are also investigating political donations and possible networks of influence that could link the interests of the crypto industry with regulatory decisions. At the same time, Donald Tusk's government is facing accusations of using the proceedings for political purposes. For the injured users, on the other hand, the main question is whether and when they will be compensated. The post Poland discusses new crypto laws appeared first on ostwirtschaft.de.