Poland’s lower house of parliament, the Sejm, has approved the Crypto-Asset Market Act (Bill 1424), introducing stringent regulations for the country’s cryptocurrency sector that align with the European Union’s Markets in Crypto-Assets (MiCA) framework but go further with domestic requirements. The bill passed with 230 votes in favor and 196 against on September 27, 2025, and now heads to the Senate for review, where amendments or a veto from President Karol Nawrocki—a vocal crypto supporter—remain possible. If enacted, it would mandate licensing for crypto asset service providers (CASPs), impose hefty fines, and even prison terms for violations, sparking widespread industry backlash over potential overregulation.
For crypto investors, exchanges, and policymakers in Europe, this development underscores the uneven rollout of MiCA across the EU, with Poland’s version criticized as the bloc’s “strictest” and a potential threat to local innovation. As Poland’s 3 million crypto users brace for changes, the bill could drive up to 90% of local exchanges out of business by 2025, according to industry estimates. Let’s break down the bill’s provisions, the controversy, and its broader implications.
Key Provisions: Licensing, Fines, and KNF Oversight
The Crypto-Asset Market Act designates the Polish Financial Supervision Authority (KNF) as the primary regulator for crypto activities, expanding its powers beyond MiCA’s baseline requirements. CASPs—including exchanges, wallet providers, and custody services—must obtain a KNF license, submit detailed corporate structures, AML procedures, and operational plans, with processing times averaging 30 months.
Core elements include:
| Provision | Details | Penalties for Non-Compliance |
|---|---|---|
| Licensing Regime | Mandatory KNF approval for all CASPs (domestic/foreign); 30-month avg. processing | Fines up to €5M or 10% annual turnover; potential shutdowns |
| Reporting & AML | Comprehensive disclosures on operations, users, and risks | Prison terms up to 2 years for violations |
| Oversight Expansion | KNF gains authority over issuers and traders; exceeds MiCA in bureaucracy | Up to 90% of exchanges could close by 2025 |
The 118-page bill, dubbed “the largest and most restrictive” in the EU by critics, contrasts with shorter implementations in Germany and the Czech Republic.
The Backlash: Industry Fears of Startup Exodus
The Sejm vote—backed by the Civic Coalition, Poland 2050, PSL-TD, the Left, and Together, but opposed by PiS, Confederation, and Republicans—has ignited fury. Sejm member Janusz Kowalski called it “overregulation,” while blockchain advocate Tomasz Mentzen urged a veto, warning of “blockchain and stablecoin destruction.” XTB and other firms eye relocation, with estimates of 90% exchange closures by 2025 due to compliance costs.
President Nawrocki, who pledged crypto support during his June 2025 election win (50.9% in runoff), has hinted at a veto, criticizing “tyrannical regulations.” Industry voices like Cashify’s Jakub Bartoszek decry it as a “fatal blow” to domestic firms, while lawyer Robert Nogacki defends it as overdue consumer protection.
Broader Implications: MiCA’s Patchwork and Poland’s Crypto Future
Poland’s bill exemplifies MiCA’s fragmented EU rollout: While aimed at standardization, national add-ons like extended KNF powers could isolate Poland from friendlier hubs like Estonia or Malta. For 3 million Polish users, it promises stability but risks stifling innovation in a sector processing billions in volume.
- Investor Risks: Compliance costs may deter startups, pushing talent abroad; 90% closure fears could slash local liquidity.
- EU Ripple: Sets precedent for stricter MiCA tweaks, potentially harmonizing or fragmenting the bloc’s $200 billion crypto market.
- Political Stakes: Nawrocki’s veto could rally crypto voters, but passage aligns with EU timelines (MiCA full effect 2026).
Supporters view it as ending the “Wild West,” per regulators, but opponents fear a “fatal blow” to Poland’s digital economy.
Conclusion: Poland’s Crypto Bill – Protection or Overkill?
Poland’s approval of the strict crypto bill in the Sejm is a double-edged sword: It enforces MiCA with iron-fisted oversight, promising investor safeguards but risking a startup exodus and 90% exchange closures. As the Senate deliberates and Nawrocki weighs a veto, the outcome could redefine Poland’s role in Europe’s crypto landscape—from innovation hub to regulatory fortress. tronweekly
