On September 26, 2025, Poland’s lower house of parliament (Sejm) approved the Crypto-Assets Market Act with a vote of 230 to 196, marking a significant milestone in the country’s regulatory approach to digital assets. The legislation now awaits review by the upper house (Senate), presidential signature, and will take effect 14 days after publication, with Article 70 concerning internet domain blocking provisions becoming effective four months after publication. The new legislation represents Poland’s comprehensive regulatory framework for crypto assets and aligns closely with the European Union’s Markets in Crypto-Assets (MiCA) regulation. The bill underwent approximately 3-4 rounds of deliberation and 45 amendments during the legislative process, transitioning Poland from a loose anti-money laundering registration system to a comprehensive licensing regime. **Key Regulatory Framework** The Act implements a typical licensing system for crypto asset businesses. Only institutions authorized by the Polish Financial Supervision Authority (KNF) and holding a Crypto Asset Service Provider (CASP) license can legally operate. **Regulatory Scope and Covered Entities** The legislation maintains close alignment with MiCA, incorporating the following entities: 1. Crypto Asset Service Providers covering: – Operation of crypto asset trading platforms – Wallet custody and asset safeguarding services – Payment and settlement services – Other crypto asset-related derivative businesses 2. Token issuers, including asset-referenced token issuers and electronic money token issuers 3. Foreign crypto asset service providers from other EU member states operating in Poland through MiCA’s passport mechanism **Licensing Requirements and Operational Costs** **Capital Requirements** CASPs must maintain “sufficient funds,” encompassing minimum capital requirements, liquidity management, risk reserve allocation, and client asset segregation. While Poland has not yet issued secondary regulations specifying minimum capital requirements, MiCA standards serve as the primary reference, with requirements varying by service type. **Regulatory Costs and Compliance Expenses** – License and assessment fees: Up to €4,500 depending on license type – Information document approval: €3,000 for approval, €1,000 for modifications – Annual license maintenance and supervision fees for CASPs: €500 to 0.4% of average annual revenue – Additional operational costs include regular financial audits, external legal counsel, KYC systems, and AML technology platforms **Compliance and Risk Management Requirements** **Governance Structure and Compliance Framework** CASPs must establish comprehensive governance systems including: – Independent compliance, risk management, and internal audit departments – Management with professional qualifications and clean records – Risk identification, internal control, and exception reporting systems – Professional confidentiality protocols and technical standards – Strict AML and KYC requirements **Additional Compliance Obligations** – Regular disclosure of financial status, risk structure, and operational metrics to KNF – Comprehensive risk management systems covering market, operational, and liquidity risks – Enhanced investor protection through risk disclosure, suitability assessments, and asset segregation – Full implementation of AML/CFT requirements including transaction monitoring – Mandatory external audits and annual compliance reporting **Prohibited Activities and Penalties** The Act establishes clear boundaries for market participants with significant penalties for violations: **Administrative Penalties** Licensed entities face fines up to PLN 5,000,000 for serious violations, while unlicensed operators can be fined up to PLN 10,000,000. **Criminal Liability** Serious offenses including operating without authorization, providing false information to authorities, or obstructing supervision can result in imprisonment from 3 months to 5 years. **Transition Period** Existing Virtual Asset Service Providers currently registered under anti-money laundering regulations have until July 1, 2026, to transition to the new licensing framework while maintaining compliance with current rules. The Polish Crypto-Assets Market Act represents a fundamental shift toward a regulated digital asset ecosystem, requiring market participants to either obtain proper authorization or exit the Polish market.