Poland has taken a hard turn in digital-asset policy. In late September, the Sejm—the country’s lower house of parliament—approved the crypto bill advances Market Act, a sweeping crypto bill that introduces licensing, heavier reporting, and the prospect of steep penalties for violations. Supporters say the law will align the market with European standards and protect consumers.
Critics warn it could smother innovation, drive startups abroad, and make Poland an outlier within the EU’s MiCA framework. The proposal now heads to the Senate, with the political debate intensifying as industry voices mobilize against what many see as overregulation.
This article unpacks what’s actually in the bill, how it compares to EU rules, why the backlash is so intense, and what the next six to twelve months could look like for exchanges, builders, and everyday users in Poland’s crypto economy.
What the bill does—and why it’s controversial
A licensing regime under the KNF
At the heart of Poland’s crypto bill is a shift from simple registration to full licensing. All crypto-asset service providers (CASPs)—including exchanges, custodians, and issuers, whether Polish or foreign—would have to obtain authorization from the Komisja Nadzoru Finansowego (KNF), Poland’s financial watchdog. Licensing would require robust disclosures around corporate structure, capital adequacy, internal controls, risk management, and AML/CTF procedures. The act also empowers the KNF as the primary supervisory authority for the sector, centralizing oversight in one body.
For the industry, that marks a decisive break with the more permissive status quo. Proponents argue this structure brings consumer protection, accountability, and clarity—especially for banks and institutional partners that have long hesitated to touch crypto. Detractors counter that concentrating power in a notoriously slow regulator could create bottlenecks and uncertainty for compliant firms trying to operate legally.
Higher penalties—including criminal exposure
Another flashpoint is enforcement. The crypto bill envisions administrative fines that can reach 10 million PLN (about $2.8 million) and, crucially, criminal penalties including potential prison terms of up to two years for serious breaches. Supporters say harsh sanctions deter repeat violators and combat scams. Critics call the approach disproportionate, arguing that it risks chilling legitimate development work—especially around smart contracts and open-source experimentation.
A tight timeline and transitional period
If enacted, the bill provides a six-month transitional window for CASPs to secure licenses, after which unlicensed operations would have to cease. For well-resourced exchanges, six months may be manageable; for smaller teams, the compliance build-out could become existential—especially if the KNF’s application processing times stretch out, as some opposition figures claim.
How Poland’s bill fits (and doesn’t fit) within EU MiCA
MiCA as the baseline—and Poland going further
The EU’s Markets in Crypto-Assets (MiCA) regulation sets a continent-wide baseline, but it also leaves room for member states to add local nuances. Poland’s crypto bill mirrors MiCA in many areas (e.g., white paper obligations and CASP standards), yet goes beyond it by explicitly introducing criminal liability and extending supervisory powers domestically. Analysts note that Poland’s approach could become one of the strictest in the EU if passed in current form.
The practical effects: from banking access to cross-border ambitions
On paper, a KNF license could improve banking relationships, giving exchanges clearer compliance credentials. It could also make it easier to passport services across the EU under MiCA—at least for firms that can absorb the upfront licensing costs and ongoing supervisory fees. But there’s a trade-off: tighter rules likely shrink the number of players, leaving a market dominated by larger, better-capitalized companies while squeezing smaller Polish startups that can’t afford new compliance overhead.
The politics: vote counts, voices, and veto talk
What parliament decided
In the Sejm, the Crypto-Asset Market Act passed with 230 votes in favor and 196 against, a notably narrow margin for a reform of this scope. With that vote, the bill moved to the Senate for further review, becoming the latest flashpoint in a broader political argument over innovation, consumer protection, and financial sovereignty.
The backlash in Warsaw—and beyond
Opposition figures and industry advocates say the law is “the most restrictive in the EU,” warning it could “destroy” the domestic crypto market and jeopardize the interests of several million Polish holders. Others have criticized the KNF’s perceived slow processing times, which they fear could translate into months or years of limbo for applicants. The rhetoric has spilled onto social media and into parliamentary speeches, with calls for the Senate to soften the bill—or for a presidential veto if it reaches the head of state unchanged.
What changes for exchanges and service providers
Compliance architecture moves from “nice to have” to “non-negotiable”
Under the Polish crypto bill, exchanges and custodians will need to demonstrate enterprise-grade governance and risk management. That means formalized internal controls, independent compliance functions, detailed AML playbooks, and documented security practices—from key management to incident response. For companies that grew up in a lighter-touch environment, this is a shift from ad hoc policies to a codified compliance stack reviewed by a national authority.
Cost curves and consolidation pressure
Licensing demands talent—compliance officers, legal counsel, auditors, and engineers who can translate policy into code. They also require tooling—transaction monitoring, KYC/KYB, travel-rule integrations, and case management systems. As costs escalate, market consolidation becomes likely: some local firms will merge, partner with larger platforms, or exit entirely. That’s not unique to Poland, but the country’s strict overlay could accelerate the trend relative to more moderate EU peers.
The cross-border calculus
For global exchanges already serving Europe, the strategy question is whether to seek KNF authorization (and signal strong compliance to banks and regulators) or to geo-fence Poland and focus on friendlier jurisdictions. MiCA’s promise of EU-wide passporting nudges firms toward authorization, but national extras—like Poland’s possible criminal exposure—complicate the equation.
What changes for everyday users and investors
Fewer platforms, more certainty
If the bill passes as written, Polish users will likely see fewer exchange choices but more standardized protections. Licensed CASPs must segregate client assets, publish clear risk disclosures (including comprehensive white papers for new tokens), and follow strict AML controls that reduce exposure to fraud. The net effect could be higher trust but less variety—especially for niche tokens or experimental products that smaller platforms used to list.
Onboarding and verification get stricter
Expect heavier KYC, tighter source-of-funds checks, and potentially stricter withdrawal controls when red flags surface. For users, that means more friction at sign-up and during high-risk transactions. For the broader market, it means fewer anonymous pathways for scams and rug pulls, which have historically eroded confidence. Tax and reporting clarity (with a learning curve)
While the bill itself focuses on supervision and licensing, downstream effects often include more consistent tax reporting and standardization across platforms. Users should prepare for annual statements, clearer loss/gain tracking, and tools that make it easier to file—albeit with a steeper learning curve in the first year as platforms and accountants adjust to the new rules. (Exact tax implementations will depend on follow-on guidance and how MiCA-aligned policies are operationalized in Poland.)
Innovation at stake: builders, open-source, and smart contracts
The chilling-effect argument
Poland’s developer community worries about criminal exposure and the possibility that routine activities—auditing a smart contract, building DeFi interfaces, or running validator nodes—could be swept into enforcement actions if definitions are broad and guidelines are vague. Critics say innovation thrives on permissionless experimentation, and that threatening jail time—even in edge cases—chills participation.
Guardrails without gridlock: what the Senate could fix
There’s room for precision drafting that preserves enforcement while safeguarding legitimate development. The Senate could clarify mens rea thresholds (intent), carve out developer safe harbors for non-custodial software, and tighten language around what constitutes a regulated service versus publishing code.
It could also mandate service-level timelines for KNF processing to counter the “slow regulator” concern and require proportionate penalties that distinguish between willful misconduct and administrative missteps. (Whether those tweaks appear will hinge on political negotiations.)
Also Read: Crypto Sector Holds Steady Market Analysis & Investment Trends 2025
Banking, stablecoins, and the institutional angle
Why banks might finally re-engage
Banks crave regulatory clarity. A KNF-licensed market gives compliance teams a checklist: counterparty is supervised, audits are performed, AML programs are in place, assets are segregated. That makes it easier to roll out on-ramps, off-ramps, and custody partnerships, unlocking services that mainstream users and corporates have struggled to access. If executed well, this is where the crypto bill could truly help the ecosystem—even as it narrows the list of eligible players.
Stablecoin scrutiny and payments
A MiCA-aligned framework already tightens controls on stablecoin issuance and reserves. Poland’s stricter flavor could amplify that scrutiny, affecting local fintechs that rely on stablecoins for payments, remittances, or treasury management. Clear rules could promote safer adoption; excessively tight rules might push product teams to launch elsewhere, then passport in later if/when the domestic stance softens.
Scenario planning: six to twelve months out
If the Senate softens the law
A Senate-led compromise could lower criminal exposure, define developer safe harbors, and set KNF deadlines for application reviews (e.g., 90–120 days), easing concerns about regulatory gridlock. The result would be a demanding but navigable regime that still meets MiCA’s spirit while acknowledging Poland’s growth ambitions.
If the bill passes largely unchanged
Expect an application wave followed by a capacity crunch at the KNF. Larger exchanges with mature compliance programs will likely secure early approvals. Mid-tier and smaller firms could be stuck in a long queue or choose to exit. Users would consolidate on a handful of platforms, and local startup formation might slow until the market digests the new normal. The backlash—already loud—would probably intensify, especially if legitimate services experience prolonged uncertainty.
If a veto or court challenge emerges
A presidential veto or successful court challenge would reset the clock, keep the current registration era alive a bit longer, and force a new round of drafting. That outcome could lift short-term pressure but risks policy whiplash—never ideal for investors or builders planning multi-year roadmaps. (For now, the bill is awaiting Senate review; any veto talk remains political speculation.)
What companies should do right now
Map your obligations early
Firms serving Polish users should gap-assess against the bill’s licensing and AML requirements and build a submission plan that includes governance upgrades, third-party audits, and documentation. Those already accredited in other EU states can reuse control frameworks, but should expect Poland-specific additions and KNF expectations.
Rethink product scope and listings
Given stricter enforcement and disclosure, review token-listing frameworks, market-abuse monitoring, and consumer-risk communications. Teams should document risk ratings, incident playbooks, and delisting procedures to show supervisors that consumer protection is embedded, not bolted on.
Prepare for user education
If platforms consolidate, incoming users will need clear onboarding, fee transparency, and security education. Building knowledge bases, in-app explainers, and tax tooling (exports, annual statements) can reduce support load and build goodwill during the transition.
What users should do right now
Verify your provider’s path to licensing
Before depositing funds, confirm whether your exchange or wallet intends to apply for a KNF license and how they plan to handle the six-month transition if the law takes effect. If your provider signals an exit, plan for asset withdrawals and tax records so you’re not scrambling later.
Expect stronger identity checks and slower edge cases
Even compliant withdrawals can be delayed if risk flags trigger manual review. Keep proof of funds handy, maintain clean records, and use reputable on-ramps to minimize friction.
Keep security hygiene front and center
Regulation cannot replace self-custody literacy, MFA, phishing awareness, and prudent hot/cold storage practices. Licensed doesn’t mean risk-free; it means clearer recourse when things go wrong.
The bottom line
Poland’s crypto bill advances is bold, far-reaching, and—if left unchanged—stricter than MiCA’s baseline. It promises stronger consumer protection and a cleaner relationship with banks, but at the cost of heavier compliance, potential criminal exposure, and real pressure on startups.
Whether the final text lands as a balanced guardrail or a growth-stifling barrier depends on what the Senate changes in the weeks ahead and how the KNF operationalizes the licensing pipeline. For now, companies should prepare, users should stay informed, and policymakers should seize the chance to refine the bill so that safety and innovation can coexist in Poland’s digital-asset market.
FAQs
Did Poland already make the law effective, or is it still pending?
As of late September 2025, the Sejm passed the Crypto-Asset Market Act, but it still requires Senate review and subsequent steps before it becomes law.
Who will regulate crypto companies if the bill becomes law?
The KNF (Komisja Nadzoru Finansowego) would be the primary regulator, overseeing licensing, supervision, and enforcement for CASPs operating in Poland.
What penalties does the bill introduce?
The proposal includes administrative fines up to 10 million PLN and potential prison terms up to two years for serious violations—measures that go beyond MiCA’s baseline and underpin much of the backlash.
Will my favorite exchange have to stop operating?
Not necessarily. Exchanges that apply for and obtain a KNF license could continue serving Polish users. Those unwilling or unable to meet the new requirements may exit or restrict services, particularly after the six-month transitional period post-enactment.
How does this differ from other EU countries under MiCA?
MiCA is the foundation, but Poland’s bill adds stricter national measures, including explicit criminal liability and expanded supervisory powers. That’s why many observers say Poland’s path could become one of the toughest in the EU
