The Czech Republic recently came out with a document detailing the crypto regulation guidelines it is planning to implement in the country.
The guidelines are clearly based on the EU AML5 suggestions but seem to be going overboard when it comes to the fines and punishments associated with the operation of an unlicensed entity.
For example, the Czech authorities said that if they identify an unlicensed company that caters to the local population, it will impose a minimum of half a million euros as a fine. This is way above and beyond the punishments that the EU was suggesting for unregulated companies.
Furthermore, there is no info available about the criteria for acquiring a license in the first place. That can also be associated with large costs. Overall, crypto exchanges will have to shell out quite a lot of funds if they want to legally operate in the Czech Republic.
Because of this, several comments were flared up criticizing the government’s decision. Many were saying that this will introduce a very hard market to tap into for local startups, as not everybody can come up with more than a million in reserve for these cases.
Local traders are afraid that these regulations could instate a monopoly and prevent new companies from starting up in the country.