A new crypto law in Hungary is putting everyday traders at risk, and is already sending many service providers packing.
According to a Forbes report, the Hungarian government has introduced a new law that criminalizes crypto operations. The legislation targets two offenses, including the “abuse of crypto assets” by traders, and the provision of “unauthorized crypto asset exchange services” by service providers.
Individuals engaging in such crypto services face up to two years in prison for basic transactions, with harsher penalties for large transactions. Trades above 50 million Hungarian forints, around $140,000, could mean three years behind bars, and anything over 500 million forints ($1.4 million) could land individuals in prison for five years.
The law doesn’t stop at just traders. Platforms that have not been vetted and approved under the country’s new validation regime operate in the region can face three years in prison. If the business processes “particularly large” volumes of crypto, the penalty jumps to eight years.
Hungary now requires all crypto exchanges to go through a state-controlled validation process. That includes strict checks on the origin of funds, wallet ownership, identity verification, and profiling. Without this official validation, any conversion of crypto into fiat or other assets is considered illegal.
The new legislation, which came into effect on July 1, 2025, puts both traders and service providers in limbo. They must now either halt operations, relocate, or run the risk of prosecution. The government has given regulatory authorities a 60-day timeline to define the specifics, but the window offers little comfort as there’s still no public guidance, no compliance playbook, and no list of approved platforms.
Hungarian crypto industry figures have described the move as damaging to the local crypto scene, with some services providers plotting exiting the market. Revolut, one of Hungary’s most popular service providers suspended all crypto services in the country last week in response, with no clear timeline for restoration. Other firms are expected to follow, with several already exploring relocations to more crypto-friendly EU countries like Estonia or Lithuania.
Local data estimates that roughly 500,000 Hungarians have been engaged in crypto operations and stand to be affected by the new legislation.
As of now, it is unclear how the updated regulations impact global service providers like Binance, Coinbase, Kraken, which operate in Hungary. Neither of the firms have announced adjustments to their services based on the new rules, with broader reports stating that direct impact on them are “unlikely.”
