02/01/2025

Notification for persons intending to trade crypto-assets

On 30 December 2024, Regulation (EU) 2023/1114, better known as the Markets in Crypto-Assets Regulation (also known as MiCA), became applicable in the Republic of Croatia. For the first time, the Regulation introduces uniform rules for business as well as supervision of the issuance of crypto-assets, trading in crypto-assets and the provision of crypto-asset services throughout the European Union.

In the Republic of Croatia, there are two authorities responsible for the supervision of crypto-assets:

  • Croatian National Bank, responsible for:
    • controlling the issuance of asset-referenced tokens (ARTs)
    • controlling the issuance of electronic money tokens (EMTs).
  • Croatian Financial Services Supervisory Agency, responsible for:
    • controlling the issuance of tokens other than ARTs or EMTs
    • supervising the operations of entities providing crypto-services
    • supervising the crypto-asset trade.

If you intend to start trading crypto-assets or are already trading them, be sure to pay attention to the following:

  • Do not deal with companies that are not authorised to provide crypto-services!

A Croatian company wishing to provide crypto-services must obtain prior approval from Hanfa. Such companies are listed in Hanfa’s registers.

Crypto-services include, for example, buying or selling crypto-assets (e.g., Bitcoin or Ethereum, as some of the well-known ones), exchanging crypto- assets for money through ATMs, or storing private keys to access crypto- assets.

  • However, there are exceptions.

Some Croatian companies already provide crypto-services to clients and are currently supervised by Hanfa only with respect to the prevention of money laundering and terrorist financing. They will also need to obtain Hanfa's authorisation in order to continue providing such services. They must do so until 1 July 2026 at the latest.

But until such authorisation is obtained, such companies are allowed to continue to provide the crypto-services they currently provide. Such entities are called virtual asset service providers (VASPs) and they are listed in THIS register.

  • Hanfa has limited powers to supervise VASPs.

This means that you will be able to exercise the full protection and rights granted to you by MiCA only after VASPs have received Hanfa's authorisation to operate in accordance with MiCA. Until then, Hanfa has only limited powers to supervise such entities and will not be able to protect you should you have a complaint about their work.

  • If you trade through foreign companies, you should be extra careful.

In the event that you have found a foreign company online by yourself, and you would like to trade crypto-assets through it, you should be extra careful. Some warning signs that could indicate fraud are: where the company is from (exotic islands are often related to dubious business practices), whether it publishes clear information about its business (e.g., the name of the company, a transparent manner to contact the company), whether it urges you to make repeated payments, etc. In case of doubt, contact the regulator from a foreign country in order to obtain specific information on the legitimacy of the company's operations. Hanfa is not authorised to supervise foreign companies.

  • Investor Protection Fund does not cover crypto-assets.

In the event that the company providing crypto-services cannot return your funds or crypto-assets to you for any reason, there is no dedicated fund that will return the assets or part of them to you. The Investor Protection Fund referred to in the Capital Market Act covers only companies providing brokerage services and financial instruments (e.g., shares, bonds), but does not cover crypto-assets.

  • Obligation to publish a crypto-asset white paper.

Anyone in the European Union intending to issue a certain type of crypto asset via a public offer will have to be transparent by publishing a crypto-asset white paper, in which they will provide information on the crypto-asset/token being issued, the associated project, rights and obligations, the technology used, the associated risks, etc.

  • MiCA’s entry into force will not eliminate many risks in relation to crypto-assets.

For example, the vast majority of crypto-assets will still remain highly risky with prices moving unpredictably. That is why you should be cautious when making any kind of financial decisions.

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