Cyprus SEC Embraces Blockchain Despite Unregulated Status of Crypto

The Cyprus Securities and Exchange Commission recently published a report discussing the ongoing activities of its Innovation Hub - a cooperative entity that was launched in October 2018 as a platform for engagement between CySEC and entities operating in the fintech and regtech sectors.

Nineteen different companies directly engage with the platform, nine of which comprised projects utilizing blockchain.

In a press release, CySEC Chairwoman Demetra Kalogerou describes the Hub as working to strengthen investor protections "By embracing new innovations in financial and regulatory technology," adding that the regulator's mission is to "Create a robust ecosystem in which fintech firms can flourish responsibly in Cyprus."

Cryptocurrency activities remain unregulated in Cyprus.

Despite the regulator's efforts to foster innovation within the DLT sector, activities involving cryptocurrencies remain an unregulated activity within the country.

In a recent interview, Kalogerous said the agency is still "Evaluating the risk and benefits of crypto innovation to determine whether further actions and legislative requirements are needed to ensure full investor protection."

CySEC accuses Naga Markets, CALIBUR CAPITAL, and IcFxMarkets of operating illegally within Cyprus, noting that the companies fraudulently claimed to have affiliation with entities regulated within the jurisdiction.

CySEC partners with London university on blockchain project.

Cyprus' securities regulator recently partnered with the University College London's Blockchain Technology for Algorithmic Regulation and Compliance, which researches applications for blockchain technology in automating compliance and regulatory procedures.

The cabinet sought to provide a platform for both public and public-private initiatives employing blockchain applications.