Italy is strengthening its grip on the cryptocurrency market with a new draft decree due to be approved this week. The move signals a tougher regulatory approach aimed at curbing manipulation and strengthening oversight, aligning with the European Union’s broader push for crypto regulation.
Million dollar fines for market chaos
According to a Reuters report, the proposed decree takes a zero-tolerance stance toward cryptographic misconduct. Activities such as insider trading, market manipulation and illegal disclosure of sensitive information could result in heavy fines for violators, ranging from 5,000 to 5 million euros (approximately 5,400 to 5.4 million of dollars).
This financial hammer blow demonstrates Italy’s commitment to protecting investors and fostering a fair and stable crypto ecosystem.
Italian Central Bank and Consob join forces
Decree assigns responsibility for overseeing crypto activities to two key players: the Bank of Italy and Consob, the country’s market regulator. This “two-pronged approach” aims to achieve a dual objective: maintaining financial stability and ensuring the orderly functioning of markets.
The Bank of Italy’s expertise in financial matters will be crucial to preventing systemic risks, while Consob’s experience in regulating traditional markets will be invaluable in addressing the challenges specific to cryptocurrencies.
Total crypto market cap at $2.29 trillion on the daily chart: TradingView.com
A badge of trust for crypto service providers
This new decree builds on existing regulations implemented in January 2022. And since the following year, the Ministry of Economy and Finance (MEF) has required that all crypto service providers operating in Italy, nationals and foreigners, must register with the Organismo Agenti e Mediatori. (OAM).
This control body, responsible for supervising financial activities and credit brokerage operations, acts as a porterensuring that only reputable suppliers can serve Italian customers.
Dual purpose
The OAM register serves a dual purpose. First, it promotes transparency by making information about registered providers easily accessible. Second, it strengthens anti-money laundering (AML) compliance, thereby reducing the risk of illicit activities in the Italian crypto market.
While the long-term impact of the new decree remains to be seen, it is clear that Italy is taking a proactive stance when it comes to regulating the crypto space.
The increased scrutiny, coupled with heavy fines and focus on registered service providers, suggests a future in which the Italian crypto market prioritizes stability and security over rampant speculation .
The question for crypto investors and businesses is whether this new environment will foster innovation or stifle its growth.
Featured image from Pexels, chart from TradingView
