By Shelly Melancon (Switzerland)
Estonia’s finance ministry has released a clarification statement regarding rumors flying around that the nation is about to issue a ban notice on crypto-related activities in the country.
How The Rumors Started
The rumors started flying around following access to a draft policy by Estonian authorities released on December 23 in which it planned to “curb criminal activities through stricter regulation of the activities of virtual asset service providers (VASPs).” The finance ministry clarified that the policy only applies to digital asset service providers, not individuals. Hence, individuals can own or trade cryptos on any platform of their choice.
The announcement further read, “but, no person owning an account with an Estonian VASP can run an anonymous account.” Likewise, Estonian VASPs are not allowed to permit anyone to run an anonymous account.” Hence, VASPs need to have each customer’s detailed profiles just as it obtains with banks. If they don’t have such profiles, they must conduct a risk analysis.
However, the policy isn’t yet effective as it awaits approval from the nation’s legislators. Besides an official statement of clarification, the finance ministry also released a detailed FAQ to address the rumors. A conclusion that we can draw from the information and FAQ is that Estonia won’t ban crypto activities but will regulate the activities of all players in the nation’s crypto sector.
Also read:Despite the clarification, some Estonia crypto enthusiasts, such as Mikko Ohtamaa (the CEO of New DeFi, a crypto firm in Estonia), claimed that the authorities will still extend the policy. Ohtamaa stated that even though it currently applies to only VASPs, it will soon be extended to include initial coin offerings, crypto exchanges, and decentralized platforms.
Estonia’s Crypto Environment
Five years ago, Estonia was among the few nations to legally approve crypto operations. Since then, the crypto market has continued to grow in leaps and bounds. But some licenses have been withdrawn for various reasons after a strict regulation on the activities in the sector three years ago.
Currently, only 450 firms have an operating license out of the nearly 3,000 licenses that have been approved between 2017 and this year. The scrutiny became necessary following accusations that one of Denmark’s most prominent banks was involved in illegal funds transactions (worth billions of dollars) with some licensed VASPs in Estonia four years ago.
Confusing Opinions From The Finance Ministry
Estonia’s crypto policy update comes on the heels of Europe’s apex bank’s similar crypto policy update. During an interview with a local news media, Matis Maeker (a top-level executive with Estonia’s finance ministry) revealed that part of the policy review would involve revoking all VASP licenses.
Then, all those still interested in running their operations will re-apply for a new license – a proposal condemned by many players in the crypto industry. Strangely, one of meeker’s pa alleged that his boss’ statement was taken out of context, and Estonian authorities won’t be taking any action in that line. Also, such actions will contradict the position of the EU.
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