Georgia, one of the most crypto-friendly countries, is introducing new crypto regulations to pursue its ambitions to become a global cryptocurrency hub.
Georgian lawmakers have prepared a new regulatory framework targeting digital business and cryptocurrency trading in the country, Georgian Economy Minister and Deputy Prime Minister Levan Davitashvili announced.
Davitashvili said a bill has been sent to parliament and the amendments are expected to be approved in the autumn session, local Business Media Georgia news agency reported on Monday.
According to the minister, the bill aims to coordinate local cryptocurrency laws with three important European Union directives, including the Payment Services Directive (PSD2)the Capital Requirements Directive (CRD), as well as the Virtual Asset Service Providers (VASP) law.
The VASP Act aims to provide legal status to entities that engage in digital asset trading. The new framework will also prevent the use of cryptocurrencies for money laundering or terrorist financing, the report notes.
According to Davitashvili, the adoption of VASP standards is crucial for Georgia to ensure sustainable regulation of the cryptocurrency industry. The minister reportedly stressed that it is important to synchronize Georgian financial legislation with associated regulations in the EU. The latest framework is just the first step for Georgia to become a cryptocurrency hub in the future, in line with the government’s official 2022-2025 development strategy.
Georgia has become one of the most crypto-friendly countries in the world. In a study by Forex Suggest, Georgia was ranked as the fourth most crypto-friendly jurisdiction after Hong Kong, the United States, and Switzerland as of July 2022. Georgia is specifically associated with a high density of cryptocurrency ATMs, allowing users to easily buy and sell crypto for cash. According to data from CoinATMRadar, Georgia is home to 45 cryptocurrency ATMs at the time of writing.
Georgian lawmakers have been working on cryptocurrency legislation this year, with central bank governor Koba Gvenetadze pointing out in April the lack of crypto regulation in the country. The first reports about Georgia’s new crypto rules came as tens of thousands of Russians are fleeing to Georgia due to Western sanctions on Russia and uncertainty about the economy. Cryptocurrencies have apparently become an important tool for many Russians arriving in Georgia to manage their finances amid credit and debit card sanctions.
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