Austria is quite loyal to blockchain and cryptocurrencies. Crypto assets or transactions with them, as well as the blockchain in Austria, are currently not regulated by any special legal framework. Moreover, representatives of the Austrian government has recently stated that there was no need for blockchain regulation at all. Such statements are motivated by the fact that excessive regulation introduced by the EU only slows down the development of technologies and there is not a single European company among the ten largest companies in the world implementing digital technologies. However, Austrian regulators are separating cryptocurrencies from blockchain technology and believe that regulation of digital assets will only benefit the industry.
If you are interested in registering a crypto company in Austria, you may find this material helpful.
The Austrian Financial Market Authority (FMA) takes a neutral approach to the supervision of crypto companies. In practice, this translates into the fact that the provision of crypto products and services are subject to the same laws and regulations as regular financial services.
Digital currencies do not qualify as financial instruments and therefore are not subject to the supervision of the regulator.
However, any use of tokens, including trading platforms, or electronic money, may be subject to financial services licensing requirements.
Thus, obtaining a crypto license in Austria is mandatory.
Also must be observed:
- requirements for prospectuses;
- special requirements for customer privacy.
An important clarification: the 5th EU Directive was recently transposed into Austrian law and with it the AML and KYC due diligence requirements for:
- cryptocurrencies exchange providers;
- e-wallet operators.
Obtaining a crypto license in Austria
To use cryptocurrency in commercial and exchange operations, one needs to get authorized and obtain licenses for banking or payment services in Austria.
From the beginning of this year, AML and KYC obligations will apply to service providers for exchanging virtual currency into national currency.
FMA does not regulate crypto assets, which are commodities. They are governed by Austrian trade authorities.
ICO in Austria
The Austrian supervisory legislation currently is quite attractive for companies considering an ICO. In more detail, ICOs in Austria are within general securities and commodity legal framework. There are no separate rules for it. In the meantime, some tokenized offerings will undergo an assessment. Different valuation models could be applied which will depend on the specific technical, functional, and/or economic structure of the proposed instruments.
Coins or tokens issued in an ICO may qualify as transferable securities within the meaning of European securities legislation such as MiFID2.
As ICOs are considered of a highly speculative nature with risky financial transactions, FMA will take further steps to ensure better investor protection.
In case of any queries and for more detailed information on the topic, you can sign up for an individual consultation on the regulation of cryptocurrencies in Austria with our specialists. We will also be happy to provide you with a full range of accompanying services when starting a crypto business in Austria and obtaining a crypto license in Austria.