Nikolas Sargeant
Poland's government has adopted an unchanged version of its controversial cryptocurrency regulation bill, intensifying a constitutional standoff with President Karol Nawrocki following lawmakers' failure to override his veto last week and raising questions about the country's path toward European Union compliance.
Prime Minister Donald Tusk framed the legislation as essential to national security during Tuesday's cabinet session, citing over 100 entities registered in Poland's cryptocurrency registry with connections to Russia, Belarus, and other former Soviet states. Government spokesman Adam Szłapka confirmed the reintroduced bill contains no modifications from the version Nawrocki rejected, stating "not even a comma" had been changed.
The measure will return to parliament later this year despite presidential objections that the framework imposes excessive restrictions beyond European Union requirements and threatens property rights protections. The dispute leaves Poland as the sole EU member state without national Markets in Crypto-Assets (MiCA) implementation ahead of the bloc's July 1, 2026, compliance deadline.
Tusk emphasized regulatory urgency before the cabinet meeting, arguing the state cannot remain passive while cryptocurrencies serve as sabotage tools for Polish adversaries. Polish authorities have identified several hundred foreign entities operating in the domestic crypto market, with investigations revealing Russian intelligence and organized crime groups exploiting digital assets for covert financing operations.
"We're dealing with very dangerous phenomena involving Russian money and the mafia," Tusk told journalists following last week's failed veto override. He suggested funds from these networks financed political promotion under a "political umbrella," implying connections between veto supporters and questionable interests.
Warsaw has previously attributed infrastructure attacks to Russian operatives, including a railway blast on supply routes serving Ukraine. Security services have documented cases of underground groups allegedly compensated in cryptocurrencies for sabotage activities. National Prosecutor Dariusz Korneluk established a specialized team last week to examine files and monitor cryptocurrency-related crimes.
Finance Minister Andrzej Domański criticized the veto's consequences, stating 20% of clients lose money to abuses in the unregulated market while the president "chose chaos." The government maintains basic oversight is essential given security threats from hostile actors exploiting unregulated crypto infrastructure.
Nawrocki's rejection centered on arguments that the legislation exceeded MiCA requirements and threatened civil liberties. His chief of staff indicated openness to regulation provided future proposals avoid excessive restrictions, though the president has not signaled willingness to approve the current bill despite Tusk's expectation that additional security briefings would change his position.
The blocked legislation would implement MiCA-style rules through licensing requirements for crypto-asset service providers, investor protection standards, stablecoin reserve requirements, and anti-money laundering controls. The Polish Financial Supervision Authority (KNF) would gain sweeping oversight powers, including authority to block crypto-related websites through administrative orders and impose fines up to 10 million zloty or prison terms reaching five years for serious violations.
The framework would also grant the KNF authority to order account blocking for up to six months in cases of justified suspicion of market abuse, provisions critics argue exceed proportionate regulatory responses.
Opposition lawmakers and industry representatives warned the bill would devastate Poland's cryptocurrency sector, which serves an estimated three million users. Tomasz Mentzen of the Confederation party highlighted the KNF's 30-month average licensing process, the longest in the European Union, while noting neighboring countries implemented MiCA with substantially shorter legislation.
Economist Krzysztof Piech argued the law was unnecessary since MiCA regulations will protect all EU residents from July 1, 2026, rendering duplicative national frameworks redundant.
Industry advocates cautioned the strict regulatory framework would drive businesses to relocate abroad, costing Poland tax revenue and technical talent as companies seek friendlier jurisdictions. Foreign Minister Radosław Sikorski suggested the cryptocurrency industry's sponsorship of right-wing political figures explained resistance to tighter oversight.
The dispute reflects broader European tensions around centralized crypto supervision, with the European Commission proposing ESMA assume direct oversight of all EU crypto firms rather than maintaining MiCA's national regulator model.
