Since 18 May this year, the official register of cryptocurrency traders has been operating in Italy at the Organismo degli Agenti e dei Mediatori (OAM).
The Vedemecum published by the OAM itself on its portal (1) defines, among other features of the Register:
a) Who is obliged to register in the Special Section of the Register of Cryptocurrency Dealers;
b) The timing of registration
c) The Registration Procedure and the necessary requirements
d) The Registration Fee
e) The obligation to report quarterly on the operations of its customers
f) The sanctioning powers of the OAM
Highlighting the entities obliged to register, namely:
1. Providers of services relating to the use of virtual currency, and;
2. The providers of digital wallet services
The regulation, therefore, covers both natural persons and legal entities that offer third parties, on a professional basis, services relating to cryptocurrencies, with the exception of the activity of merely issuing virtual currencies on one’s own account, which, if not carried out on a professional basis and on behalf of clients, is not in itself sufficient to qualify operators as providers of services relating to the use of virtual currency.
The Organism takes up the definition that the Decree of the Ministry of Economy and Finance (MEF) of 13 January 2022 (by which precisely the Official Register of Cryptocurrency Operators was established) provides for virtual currency, namely: ‘a digital representation of value, neither issued nor guaranteed by a central bank or public authority, not necessarily linked to a legal tender, used as a means of exchange for the purchase of goods and services or for investment purposes and transferred, stored and traded electronically‘.
Starting from these facts, let us try to analyse what has emerged from the subjects that, to date, are formally enrolled in the OAM’s Virtual Currency Operators Register.
We currently find 29 registered subjects. Of these, 14 have been registered since 27 May, i.e. just 9 days after the Register came into force. This is in full compliance with the timeframe indicated by the OAM, which stipulates that the body must, within 15 days of receipt of the application for registration, either order or deny registration.
Binance represents one of the world’s largest cryptocurrency exchanges and has strengthened its presence in Europe by obtaining registration and regulatory approval in Italy. Binance had previously registered to operate in France in early May.
It should be noted that last July, Italy had blocked Binance itself from offering services to users in our country, stating that the company was ‘not authorised to provide investment services and activities’. The statement also prohibited Binance from making its website available to Italian citizens.
The new registration will allow the company to resume offering cryptocurrency products to customers in the country and to open offices, Binance said.
“Clear and effective regulation is essential for the mainstream adoption of cryptocurrencies” Changpeng Zhao, CEO of Binance, said in a statement. “We thank the Ministry of Economy and Finance and the OAM for their efforts in defining and monitoring the requirements necessary to operate in Italy with full transparency.”
It is clear, therefore, that for Binance this possibility is viewed very positively given that the company can now offer cryptocurrency services in Italy less than a year after being labelled as ‘unauthorised’ by financial regulator CONSOB last July.
Incidentally, the registration announcement comes weeks after Binance, continuing its global expansion, secured AMF approval in France and licences in Bahrain and Dubai.
Again, this is one of the most successful European platforms that bases its fortunes on the flexibility it offers its users to invest in almost 2000 digital assets.
In this case too, registration on the Italian Registry comes after registration with the French AMF and with the Swedish and Czech authorities.
From the statements of the Country Manager, Dr. Merone, it is clear that for Bitpanda, too, the regulation of the cryptocurrency market is fundamental for the growth of its company. Indeed, the official statements read: “Clear rules and greater transparency are absolutely necessary elements for the cryptocurrency sector and, more generally, digital assets, to make a further qualitative leap forward in order to be increasingly better integrated into the broader financial sector. Bitpanda’s history demonstrates our approach of absolute respect for the rules and support for all initiatives in this area.“
Anubi Digital Srl
Anubi represents one of the first companies in the world to provide access to institutional DeFi, i.e. the possibility for those who hold bitcoins or other digital currencies to make them ‘work’ in a practically automatic way in a decentralised and disintermediated manner, through decentralised finance tools (precisely defined as DeFi). It is therefore clear that for Anubis, the creation of the registry is but one more step towards the reliability and security of the cryptocurrency market.
Once again, the statements following registration are very clear in this regard.
“Obtaining registration in the special OAM register,” says Diego D’Aquilio, Co-Founder and CEO of Anubi Digital, “is an important new step in our operational strategy, which has always aimed to operate in full compliance with the best market standards, starting with the use of KYC and the AML (anti-money laundering) policy. The special OAM register is the first step towards the desired regulation of the market that we expect from the forthcoming arrival of the European MiCA regulation“.
This is the largest Bitcoin ATM provider operating in the European cryptocurrency exchange market.
There had been a lot of criticism in connection with this entity that it was possible to carry out transactions against anti-money laundering regulations simply by exchanging cash into cryptocurrencies at one of its ATM terminals.
The company had always denied the possibility of carrying out this type of operation through its terminals in the face of measures to protect its customers and to comply with Italian anti-money laundering regulations, but enrolment in the register ‘will allow the company to offer new services to its customers in full compliance with the regulations in force”, testifying to CryptoLocalATM’s commitment to comply with local regulations on cryptocurrencies.
The registration provides for the transmission to the OAM of data on transactions carried out on the territory of the Italian Republic on a quarterly basis’ (from the cryptolocalatm website) (2).
Young Platform is an Italian exchange that allows users to carry out the usual economic transactions with cryptocurrencies while using ‘traditional’ currency, including euros.
This platform is the first Italian company to be enrolled in the OAM Registry, and like previous enrolled companies, they too have published a press release on their site highlighting how: ‘Being enrolled in the register for virtual currency operators is the essential condition for being able to legally provide crypto services in Italy. In fact, the exercise on Italian territory of services relating to the use of cryptocurrencies and the provision of digital wallets is reserved exclusively for registered entities. With its registration in the OAM register, Young Platform is in line with the legislative decree and will be subjected in full transparency to the necessary controls to ensure a positive experience for users.“
Emphasising once again how registration guarantees users in terms of the transparency of transactions carried out on the various portals.
Surely the ratio of the establishment of the OAM Registry is to have, on the part of the Italian State, greater control over the movements of virtual currencies with the declared aim of stemming the use for illicit transfers and fraud.
To make this control really concrete, of course, we must consider the sanctions that have been provided for by the MEF Decree that established the register.
There is a preventive one that provides for an administrative sanction imposed by the Ministry of the Economy and Finance from 2,065 to 10,329 euros in the event of abusive exercise of their activity (pursuant to Article 17-bis, paragraph 5 of Legislative Decree 141/2010), and can go as far as seizure through obscuration and inhibition of access to the site or app in the event of failure to register with the OAM Register.
But the biggest novelty is in the need to provide the MEF with quarterly reports of transactions carried out through the portal with an indication of customers.
It is clear that a cross-check of transactions matched to individual users could allow real control over money laundering operations. Services registered with the OAM register will have to adopt all the necessary procedures to recognise their customers (KYC – Know Your Customer) and ensure that doing business with them does not present a risk profile. The primary objective is to prevent individuals with criminal activities from using digital currency services for activities that can be construed as money laundering. In this way, police forces such as the Special Currency Police Unit of the Guardia di Finanza, in the exercise of their functions within their respective areas of specialisation, can request from the OAM data and information on service providers relating to the use of virtual currency and digital wallet service providers.
We must remember that even before the introduction of the Registry, there was an obligation for companies operating in the financial market (and therefore also crypto) to comply with Italian anti-money laundering regulations, but, as we saw above, it was the control that was the most difficult part for the Italian Ordinance. And in fact, in 2021 alone, 3,500 reports related to cryptocurrencies arrived at the Uif, the Bank of Italy’s financial information office. Of these, 326 were also from specialised operators in the sector.
It is now clear that the creation of the cryptocurrency ‘registry’ has provoked reactions that are at opposite ends of the spectrum.
On the one hand, we find the digital world (3), which points out that the very text of the decree establishing the registry is anchored in the old dogmas of the traditional economy and has only sought to assimilate cryptocurrencies to classic currency, not so much to increase control over suspicious movements as to be able to tax the (very valuable) capital gains on digital transactions that are still in fiscal limbo.
On the other hand, the world of institutions (4) wants to emphasise how the registry has also been established in other states and that it is the first step needed to allow cryptocurrencies to spread without encountering those limits, even if only cultural ones, that the uncertainty of regulation has done nothing but increase, especially among older investors.
While it is certainly not up to us to take a position on who is right, we must also emphasise that, as yet, it is still too early to be able to make a real judgement on the impact of the registry.
Niccolò Lsorsa Borgomaneri
14 July 2022
(3) Among others https://www.criptovaluta.it/30196/nuovo-decreto-criptovalute-parola-allesperto-ce-da-preoccuparsi
(4) Among others https://www.milanofinanza.it/news/registro-cripto-a-prova-di-fuga-2562023