Key Points
- The Romanian Government is discussing an emergency ordinance to impose stricter rules for crypto transactions.
- Anonymity is also targeted by measures that aim to strengthen crypto market control.
According to the latest reports coming from various Romanian publications including stiripesurse.ro, profit.ro, bursa.ro, the Romanian government is working on an emergency ordinance that aims to impose stricter rules for crypto issuers and transaction platforms.
The new rules will reportedly target user anonymity as well, as they require KYC measures to combat money laundering.
ASF and BNR as Supervisors
According to official reports, crypto issuers and digital asset transacting platforms will have to get official authorizations and they will placed be under the supervision of the Financial Supervisory Authority (ASF) and the National Bank of Romania (BNR).
These measures for regulating the crypto market arise following authorities’ worries regarding using digital assets as an alternative to traditional financial transactions. According to them, crypto can ease legislation by bypassing and facilitating the financing of illegal activities.
Under the draft normative act, stricter rules to eliminate transaction anonymity will be set in place.
Eliminating Anonymity With Stricter Rules
One of the main objectives of the new regulation is eliminating crypto transaction anonymity. Any digital asset transaction via a crypto platform will require identification for both the payer and the beneficiary, a step that is reportedly necessary to prevent using crypto for illegal purposes.
Official reports note that the executive intends to amend Lae 129/2019 on the prevention and combating of money laundering and terrorist financing.
The new amendment would include elements from the EU Regulation 2023/1113 regarding funds and crypto transfers. Upcoming changes also involve replacing the term “virtual currency” with “crypto asset,” and “digital wallet provider” with “crypto-asset service provider.”
Also, according to regulation, there will be new requirements regarding crypto-transacting users, including the use of non-custodial wallets which involves the user alone owning access to the decryption keys.
EU has already adopted Regulation 2023/1114 involving crypto assets also known as MiCA.
Crypto providers are considered financial institutions, according to new regulations.
Key Definitions via New Regulation 2023/1114
- Crypto asset: A digital representation of value or a right that can be transferred and stored electronically using DLT or similar technology.
- Crypto asset service provider: A legal person/other entity whose occupation or business is the provision on a professional basis of one/more crypto asset services to customers and which is authorized to provide crypto asset services per Article 59.
Key Requirements for Crypto-Asset Service Providers
- Strict KYC measures: Reporting entities must apply standard customer due diligence measures for the occasional transfer of funds and crypto assets exceeding 1,000 Euros; even for payments below 1,000 Euros, data on the payer and beneficiary must be provided.
- Cross-border transactions: For transactions with non-EU crypto asset service providers, Romanian providers must conduct enhanced due diligence, including assessing the entity’s reputation, supervision quality, and anti-money laundering controls.
- Non-custodial wallets: Providers must identify and assess money laundering and terrorist financing risks associated with transfers from non-custodial wallets while implementing measures to mitigate risks.
- User identification: Providers must know and verify the identity of users of non-custodial wallets, including beneficial owners.
- Supervision: Crypto asset service providers that are also banks or electronic money institutions will be supervised by BNR and ASF.
- EU firms: Crypto firms authorized in other EU states must have a contact point in Romania to ensure compliance with anti-money laundering and counter-terrorism financial requirements.
- Corresponding relationship: The ordinance also introduces a definition for the corresponding relationship between credit institutions and other financial institutions regarding crypto asset transactions and transfers.
According to official data quoted by profit.ro, the new regulations aim to:
- Increase transparency in crypto transactions
- Prevent money laundering and terrorist financing
- Bring crypto activities under stricter regulatory oversight
These new regulations align Romania with the broader EU efforts to regulate the crypto market and are expected to come into effect at the end of 2024.
