FAQs about crypto-assets
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What are cryptoassets?
A cryptoasset can be defined as the digital representation of a value or of a right that is able to be transferred and stored electronically using distributed ledger technology or similar technology. Different terms have been used for cryptoassets in the past, including virtual currencies, crypto currencies and digital currencies. The term “virtual currency” is used for cryptoassets in legislation relating to the prevention of money laundering and terrorist financing.
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Are entities that provide for the purchase, storage and trading of cryptocurrencies systemically regulated and supervised?
The Markets in Crypto-Assets Regulation (MiCAR), which establishes uniform requirements for public offerings and admission to trading on a platform for the trading of asset-referenced tokens, e-money tokens and cryptoassets that are neither asset-referenced nor e-money tokens, and sets out the requirements for cryptoasset service providers, was published in June 2023 in the Official Journal of the European Union. Title III (Asset-referenced tokens) and Title IV (E-money tokens) of the Regulation shall be applied from 30 June 2024, and the remaining provisions from 30 December 2024.
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Useful links
Cryptoassets have also been discussed by other institutions. Some important links:
- Financial Stability Board:
Warning with regard to purchasing, storing and investing in virtual currencies, 9 October 2017 - European Central Bank:
Publications on cryptoassets - EU financial supervisors (ESAs):
Warnings against potentially harmful financial activities - Securities Market Agency (SMA):
Speculative investments in CFDs and cryptoassets (in Slovene)
SMA position on ICOs (in Slovene) - Financial Administration of the Republic of Slovenia (FARS):
Trading in cryptoassets (in Slovene)
Cryptoasset mining (in Slovene)
- Financial Stability Board:
General information about crypto-assets
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What are the risks relating to cryptoassets?
The key risks inherent in cryptoassets and related products highlighted by financial supervisors in the EU include:
- you may lose the entire amount invested;
- prices can rise and fall (even to nothing) very quickly;
- you may fall victim to scams, fraud, operational errors or cyberattacks;
- if you use cryptoassets as a means of payment, you are not protected as you are when you make a transfer from a payment (current) account;
- if something goes wrong, you are unlikely to have any rights to protection or compensation.
Given the growing interest in cryptoassets, Banka Slovenije is making consumers aware of these warnings relating to cryptoassets, while a warning about the risks inherent in cryptoassets has also been given by Slovenia’s Financial Stability Board, which is chaired by Banka Slovenije.
Regular joint warnings on the risks to consumers from cryptoassets are also issued by EU financial supervisors such as the European Securities and Markets Authority (ESMA), the European Banking Authority (EBA), and the European Insurance and Occupational Pensions Authority (EIOPA).
We should also point out that the Markets in Crypto-Assets Regulation (MiCAR), which establishes uniform requirements for public offerings and admission to trading on a platform for the trading of asset-referenced tokens, e-money tokens and cryptoassets that are neither asset-referenced nor e-money tokens, and sets out the requirements for cryptoasset service providers, was published in June 2023 in the Official Journal of the European Union. Title III (Asset-referenced tokens) and Title IV (E-money tokens) of the Regulation shall be applied from 30 June 2024, and the remaining provisions from 30 December 2024.
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What should I be particularly careful of when deciding to purchase cryptoassets and related products?
Before purchasing cryptoassets, you should ask yourself at least the following questions:
- Can I afford to lose all the money I invest?
- Am I ready to take on high risks to earn the advertised returns?
- Do I understand the features of cryptoassets or related products and services?
- Is the firm/party I am dealing with regulated, where are they established and who supervises them?
- Has the firm/party I am dealing with been blacklisted by the relevant national authorities (although not being blacklisted is no guarantee that a firm/party is safe to deal with)?
- Am I able to effectively protect the devices I use for buying, storing or transferring cryptoassets, including my private keys?
- What are the fees (commission) I will pay to (i) acquire the cryptoassets and (ii) transfer/sell these units?
- In which country is the entity with whom I am entering into a contract established, and what is the legislation there (tax arrangements, AML/CFT, etc.)?
- What/who guarantees that I will be able to convert my units of cryptoassets back into fiat currency (euro, US dollar, etc.), and how? How quickly can I convert cryptoassets into fiat currency?
- What benefits do I gain by investing? Does the particular cryptoasset scheme even allow for conversion back to fiat currency?
- What legal recourse do I have if I fall victim to scams or fraud, and will anyone return my money to me in this event?
- What is the tax treatment of cryptoassets and of trading in them? What are the resulting tax liabilities? Answers to this question can also be found in the clarifications by FARS (in Slovene).
We suggest that anyone who lacks the information to be able to answer the above questions should reconsider whether a purchase of this type is sensible. Even if a well-informed individual opts for such a purchase, it is recommended that the amount invested should not constitute an excessive exposure, and that they should be aware that it could be lost.
Holders of cryptoassets who want to use them for making payments are advised to first check whether any fees or commission have to be paid to do so.
We should also point out that the Markets in Crypto-Assets Regulation (MiCAR), which establishes uniform requirements for public offerings and admission to trading on a platform for the trading of asset-referenced tokens, e-money tokens and cryptoassets that are neither asset-referenced nor e-money tokens, and sets out the requirements for cryptoasset service providers, was published in June 2023 in the Official Journal of the European Union. Title III (Asset-referenced tokens) and Title IV (E-money tokens) of the Regulation shall be applied from 30 June 2024, and the remaining provisions from 30 December 2024.
For consumers thinking of purchasing crypto-assets
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Do we need to register with Banka Slovenije if we provide “virtual currency services” as these are defined by the Prevention of Money Laundering and Terrorist Financing Act?
Legal and natural persons who in the pursuit of their business activities or profession provide virtual currency services (the term used by the ZPPDFT-2 for cryptoassets) or other transactions included under these services (e.g. conversion between fiat currencies and virtual currencies, storage or administration of virtual currencies, services in connection with the issuance of virtual currencies) are also classed by the Prevention of Money Laundering and Terrorist Financing Act (ZPPDFT-2) as obliged entities who are required to take the prescribed measures to prevent money laundering and terrorist financing. Under the ZPPDFT-2, providers of virtual currency services who are established in Slovenia or who have a branch in Slovenia are additionally required to register with the Office for Money Laundering Prevention before commencing the provision of virtual currency services.
Further information and resources regarding registration:
- Articles 5 and 6 of the Prevention of Money Laundering and Terrorist Financing Act (ZPPDFT-2) contain provisions on the register of virtual currency service providers. Point one of the first paragraph of Article 185 of the ZPPDFT-2 lays out the offence connected with the failure to register prior to providing services.
- Rules on the register of providers engaged in exchange services between virtual currencies and fiat currencies and custodian wallet providers.
- Form for requesting entry in the register of virtual currency service providers.
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Can we expect any changes to cryptoasset legislation in the future?
The Markets in Crypto-Assets Regulation (MiCAR), which establishes uniform requirements for public offerings and admission to trading on a platform for the trading of asset-referenced tokens, e-money tokens and cryptoassets that are neither asset-referenced nor e-money tokens, and sets out the requirements for cryptoasset service providers, was published in June 2023 in the Official Journal of the European Union. Title III (Asset-referenced tokens) and Title IV (E-money tokens) of the Regulation shall be applied from 30 June 2024, and the remaining provisions from 30 December 2024.