Hungary Introduces Strict Penalties for Unauthorized Crypto Trading
Hungary has amended its Criminal Code to include prison sentences for unauthorized crypto trading and operating unlicensed exchanges. The new regulations, effective since July 1, impose penalties of up to two years for individuals using unauthorized platforms, with sentences increasing based on transaction values. Unauthorized service providers face even harsher consequences, with potential prison terms reaching eight years for large-scale violations.
Understanding Hungary’s New Crypto Regulations
The legislation establishes clear penalties tied to transaction volumes:
- Transactions worth 5-50 million forints ($14,600-$145,950): Up to two years imprisonment
- Transactions worth 50-500 million forints ($145,950-$1.46 million): Up to three years
- Transactions exceeding 500 million forints: Up to five years
Service providers operating without authorization face steeper penalties, with maximum sentences of eight years for the largest violations.
Impact on Crypto Businesses and Users
The abrupt implementation has created uncertainty among crypto businesses in Hungary. The Supervisory Authority for Regulatory Affairs (SZTFH) has a 60-day window to develop compliance guidelines, leaving companies without immediate clarity. Revolut, the UK-based fintech firm, initially suspended crypto services in Hungary but later reinstated withdrawals while pursuing an EU crypto license.
Broader Implications for Crypto Regulation
Hungary’s approach represents a significant development in global crypto oversight. These measures demonstrate how governments are working to balance innovation with consumer protection in digital asset markets. The Hungarian model may influence regulatory approaches in other jurisdictions considering similar frameworks.
