Estonian financial officials seek to cancel all crypto exchange licences in order to restart the regulatory framework from the ground up.
According to local state-run news outlet Eesti Ekspress, Matis Mäeker, the head of Estonia’s Financial Intelligence Unit (FIU), the state should “set the regulation to zero and start licencing all over again.”
According to Mäeker, the general public is ignorant of the hazards associated with the bitcoin business. Formerly the chief of the Financial Supervision and Resolution Authority’s Anti-Money Laundering section, the official raised a variety of issues, including illicit crypto activities, such as money laundering and terrorism funding, as well as the industry’s vulnerability to cyberattacks.
Estonian crypto sector does not provide “anything meaningful”
According to Mäeker, over 400 firms in Estonia currently have a virtual asset service provider (VASP) licence. Which is higher than the total number of VASP licences issued throughout the European Union. Such firms, according to the official, merely utilise their licences to “flip over extremely significant sums, while Estonia receives nothing out of it.”
According to him, the Estonian crypto sector does not create jobs for Estonians. And does not provide “anything meaningful” to the country’s tax authorities in its current condition.
Tougher capital restrictions are vital
Mäeker recommended that the business should comply with tougher capital restrictions. Such as requiring crypto firms to hold at least 350,000 euros ($404,000) in cash or assets. Industry startups now required to have just 12,000 euros ($13,800) in equity.
To improve investor security, the official also proposed forcing crypto firms to build up more secure IT systems. And preventing them from accepting anything other than real cash for investment instead of choices like refinancing property.
According to earlier reports, the Estonian FIU began a significant crackdown on crypto businesses in June 2020. Robbing the licences of approximately 70% of all VASPs in the nation by December of last year. In 2020, Estonian Public Broadcasting reported that the regulator cancelled a total of 1,808 VASP licences.