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Hungary plans to remove criminal penalties tied to crypto trading, reversing rules that forced certain crypto-to-fiat and crypto-to-crypto transactions through a local validation system.
Government spokesperson Anita Köböl said the new administration will decriminalize crypto trading after the 2025 framework disrupted market activity and drew scrutiny from the European Union. The change would bring Hungary closer to the bloc’s Markets in Crypto-Assets regime.
2025 Validation Rules Created Jail Risk
Hungary’s 2025 amendments required crypto conversions to receive a compliance certificate from an approved crypto-asset conversion validation service provider. Without that certificate, a transaction could be treated as unauthorized and legally invalid.
The rules also created criminal offenses for users and service providers. CMS said users faced up to eight years in prison for large unauthorized exchange transactions, while providers could face similar penalties for handling conversion services outside the validation system.
Revolut Suspended Hungary Crypto Services
The framework quickly affected market access. Revolut suspended crypto services in Hungary after the rules took effect, while other platforms reportedly considered shifting operations to Estonia or Lithuania.
The response showed how Hungary’s validation layer affected market access. Firms already preparing for MiCA had to deal with an added national approval system and possible criminal liability if transactions did not pass through the local process.
EU Infringement Case Added MiCA Pressure
The European Commission opened an infringement procedure against Hungary in January, saying Budapest had failed to correctly apply parts of the EU crypto framework. The case added pressure on Hungary to bring national rules back in line with MiCA.
MiCA is meant to create a single EU framework for crypto-asset service providers, token issuers and stablecoin activity. Hungary’s extra validation requirement created uncertainty because firms licensed or preparing for authorization elsewhere in the bloc still faced separate local barriers.
Replacement Bill May Align With MiCA
The reversal does not mean Hungary is removing crypto oversight. The government is expected to replace the criminal framework with rules aligned more closely with MiCA and European supervision.
The replacement bill will show whether Hungary fully removes the validation model or keeps a lighter national version inside its crypto framework.
