Europe’s Markets in Crypto Assets (MiCA) rules, along with national regulations, are threatening the survival of the majority of Polish cryptocurrency exchanges, analysts have warned.
While global players are already adapting to the changes, which require serious investments in legal and technological capacity, small domestic platforms in Poland find compliance costs prohibitive.
MiCA may push Polish exchanges out of business
Poland’s cryptocurrency market, one of the largest in Central and Eastern Europe, is preparing for an unprecedented transformation that has the potential to seriously affect local businesses, the Bitcoin.pl portal noted in an article this week.
As many as 90% of cryptocurrency exchanges in the country could cease operations by the end of 2025, the crypto news outlet warned, quoting industry watchers.
MiCA, the European Union’s common regulatory framework for crypto assets, and the “astronomical costs of complying” with the new requirements, including Polish ones, will cause a “wave of closures” in the sector, the website predicted.
Under the EU regulation, providers of crypto-related services across the bloc are now obliged to abide by strict unified rules, but the associated expenses may vary significantly from one member state to another.
Obtaining a license in Poland would cost an applicant between 1.5 and 3 million Polish złoty (roughly $400,000 – $800,000), and that’s not even the full bill yet.
Crypto firms must also raise at least €500,000 (over $580,000) in the form of initial capital and implement advanced compliance and reporting systems, the report highlighted.
These requirements are impossible to meet for small to medium-sized crypto exchange offices that have until now operated on the fringes of the financial market, the author insisted. The owner of one such office in Warsaw, who asked not to be named, put it even more bluntly:
“This is a death sentence for local players. We can’t afford millions of złotys for licenses and an army of lawyers.”
Big players are likely to benefit, both in Poland and the EU
At the same time, large international players in the crypto trading space, and those funded by foreign capital, are well-positioned to weather the upcoming regulatory change.
Global platforms, the likes of Binance and Coinbase, are already adapting to the new MiCA regulations which surely involves investing in legal and tech teams, Bitcoin.pl remarked.
And while investors will gain greater protection for their interests and funds, under the watchful eye of the Polish Financial Supervision Authority (KNF), the market consolidation will certainly result in less competition and higher fees, if not limited access to services.
This is, in fact, a pan-European trend, with similar developments in leading EU economies such as Germany and France, where smaller market participants are also going out of business, although the lack of clear regulations in Poland is exacerbating the process.
Polish lawmakers are currently debating a controversial bill that has been criticized by the local crypto community as going beyond the MiCA standards. The draft law, submitted by the government in early July, was recently passed by the Sejm on first reading.
A dedicated committee is now being formed in the lower house to oversee the regulatory effort. The crypto task force comprises members of various political parties and deputy ministers responsible for digital affairs and technology development.
Avoiding overregulation and reducing the burden of fees for entities engaged in the industry are among its main goals, along with removing barriers to cryptocurrency investment and attracting crypto capital to the country that will translate into bigger budget receipts.
In any case, Poland’s “crypto Wild West,” with its large number of businesses operating in the shadow economy, seems to be coming to an end. The transition period for MiCA compliance is set to expire at the end of December when Polish crypto platforms will have to decide whether to stay or leave.
And not all see that as a negative. “This isn’t the end … We will finally be able to compete with traditional financial institutions on an equal footing,” argued a representative of a major Polish exchange which is planning to remain in the country.
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