As more and more countries are targeting cryptocurrency, Romania becomes the latest to introduce Electronic Money Law which places cryptocurrency in the state’s regulation cross-hairs. The draft regulation sets precedent to electronic money, proposing certain requirements for the issuers of electronic money.
It defines electronic money as “monetary value stored electronically, including magnetic, representing a claim on the issuer issued on receipt of funds for the purpose of performing payment transactions and which is accepted by a person other than the issuer of electronic money.”
The draft was proposed by Romanian Ministry of Finance and makes BNR the sole authority over electronic money in the country.
The project specifies that any legal entity that is considering the issuance of electronic money must have a share capital of at least EUR 350,000 and the members of the organization must be approved individually by the Romanian National Bank (BNR) following the verification of the tax and legal records.
Under the draft, institutions who wish to launch an electronic currency must submit an application to the Romanian National Bank to be reviewed over a period of three months. During the review, the Bank will ensure that the organization has developed the appropriate management structures and effective procedures for identifying risks.
The draft also states that authorizations for electronic money issuance are valid for 12 months from the date of issue. In the event that the company does not commence operations in that time, the authorization will be voided.
The NBR may also withdraw the authorization granted to a provider of electronic money in the following situations:
- The issuer of electronic money does not carry out electronic money issuance activity on the territory of Romania.
- The authorization was obtained on the basis of false information or any other illegal means.
- The issuing electronic money institution no longer fulfills the conditions under which the authorization was granted or other conditions laid down that endanger the stability of the payment system.
What this potentially means for cryptocurrencies and crypto companies in Romania is that the regulator wishes to assume complete control over all money-issuance activities in the country. In other words, if they wish to engage the Romanian market, they will have to go through the BNR and the Ministry of Finance. If the emergency ordinance bill scales through, the BNR will effectively gain sole ownership of the electronic money space in Romania.
The e-money regulations have been proposed just weeks after the governor of the National Bank of Romania, Mugur Isarescu, made a statement against cryptocurrencies. Last month, he said it was hard to believe they could become actual money as they were unable to fulfill the basic functions of fiat currencies. In his opinion, the biggest problem with cryptocurrencies is the lack of a trusted issuer:
It’s not clear who the issuer is. From this perspective, it’s even a security problem.
Romanian cryptocurrency industry is relatively new with introduction of first organization in March this year.
The United Blockchain Association of Romania is a non-govermental organization that works to raise awareness of cryptocurrency by educating the public and creating a platform for dialogue.
A recent poll showed that more than half of Romanians living in cities know about cryptos, and 60% of people under 40 believe they are the future of payments.
According to the poll, 57% of Romanians in urban areas have heard of cryptos. Almost a third of them believe that they are the currencies of the future. 17% of the respondents admit they are planning to acquire digital coins within a year. Another 8% say they have already bought cryptocurrencies in the past 12 months.
The study was conducted online by iSense Solutions on a sample of 500 urban respondents, members of the ResearchRomania.ro Panel.