Poland’s Sejm Backs Tough Crypto Law with Fines and Prison Sentences

Key Highlights Poland’s new crypto law expands regulator powers far beyond EU rules Industry warns startups could flee Poland under tough new measures Harsh penalties raise fears of a shrinking and less innovative market Poland Approves Strict Crypto Bill With EU Backing but Market Divided Poland’s lower house of parliament the Sejm has passed a crypto bill aligned with the European Union’s MiCA ￰0￱ law expands the powers of the Polish Financial Supervision Authority (KNF) but has drawn sharp criticism from industry players who fear it could push smaller companies out of the ￰1￱ Rules and Heavy Penalties Under the new law the KNF will have the authority to: License cryptocurrency service providers (CASPs) Oversee token issuance and reporting obligations Block suspicious domains Impose multimillion-zloty fines Violations such as operating without a license or failing to submit the required documents could result in penalties of up to 10 million zlotys (about $2.75 million) or even two years in ￰2￱ must also separate client funds from company assets

a move seen as a safeguard against ￰3￱ Reactions While regulators call the law a “watershed moment” that ends the “Wild West” era of crypto in Poland industry voices argue it goes too ￰4￱ Forma of Solidus Labs called it “an important step” but warned that going beyond MiCA could “undermine EU coherence and stifle innovation.” Others were more ￰5￱ Perwienis of Binance Poland said the KNF’s new powers could have “ serious consequences .” Critics point to “gold plating,” where national regulators add extra burdens on top of EU ￰6￱ anonymous analyst writing under the name Świat Krypto said the law empowers officials to shut down companies “any day now,” calling it harmful for Poland’s crypto ￰7￱ say the law is designed to protect investors and bring stability

while opponents fear it could trigger an exodus of startups and small ￰8￱ Robert Nogacki argued that stricter oversight is overdue stressing that “innovation cannot be an excuse for avoiding consumer protection.” Meanwhile authorities insist the rules will ensure long-term market development and safer ￰9￱ changes come shortly after Poland launched its first Bitcoin ETF on the Warsaw Stock Exchange signaling both opportunity and uncertainty for the sector.