Hungary to reverse crypto criminalization after EU scrutiny
Hungary's new government has announced plans to revise cryptocurrency legislation that imposed criminal penalties for certain digital asset transactions. Officials acknowledged that the current rules have negatively affected the market and attracted the attention of European regulators.
The intention to repeal the controversial provisions was announced during a press conference by Anita Kebel, a government representative from the Tisza party. According to her, the restrictions introduced in 2025 created serious risks for users.
"It was an unnecessary law. It made practical operations impossible and frightened market participants," Kebel said.
She added that the consequences of the regulation impacted hundreds of thousands of Hungarian citizens. According to the government representative, authorities intend to abandon requirements that mandated cryptocurrency transactions be verified and approved through specially authorized entities.
Up to eight years in prison for crypto transactions
The controversial provisions came into force on July 1, 2025, following amendments to the criminal code and the country's digital asset market law.Under the rules, cryptocurrency exchanges were required to operate exclusively through specialized organizations licensed by the supervisory authority. These intermediaries verified the origin of funds, wallet ownership, user information, and transactions before issuing compliance certificates.
Transactions conducted without such certification were deemed illegal. Criminal penalties were introduced for both individuals and businesses depending on transaction volumes.
For transactions ranging from 5 million to 50 million Hungarian forints (approximately $16,000-$164,000), offenders faced up to two years in prison. The maximum penalty for larger transactions reached eight years of imprisonment.
EU scrutiny
According to Kebel, the consequences of the regulation proved far more severe than expected. Several cryptocurrency platforms, including Revolut, were forced to limit or completely suspend certain services for Hungarian customers.Additional pressure came from the European Union. Regulators began examining whether Hungary's restrictions were compatible with the bloc's broader framework for regulating crypto assets.
The legislative review became one of the first actions taken by the new government following the April parliamentary elections. The vote ended Viktor Orban's 16-year rule and brought the pro-European Tisza party, led by Peter Magyar, to power.
The debate over Hungary's restrictions comes amid a broader reassessment of crypto regulation across the EU. Earlier, the European Commission launched a public consultation to evaluate the effectiveness of the MiCA framework, which has been in force for about a year and a half.
Brussels aims to determine whether the current regulatory framework adequately serves the crypto asset market. Following the consultation, certain provisions of MiCA could be revised or expanded.
Earlier, Ledger CTO Charles Guillemet said that MiCA is reshaping competition within Europe's Web3 industry.
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