The MiCA Regulation and the Polish Crypto-Assets Market Act
The EU MiCA Regulation (Markets in Crypto-Assets, Regulation (EU) 2023/1114 of the European Parliament and of the Council) was intended to create a uniform legal framework for the crypto-asset market across the European Union. Its overriding aim was to support innovation, increase the security of market participants and enable businesses to carry out cross-border activity on transparent terms. Among other things, MiCA introduced a licensing requirement for providers of crypto-asset services (known as a CASP - Crypto-Asset Service Provider), set out rules for the issuance of tokens and imposed disclosure obligations towards clients.
Crucially from a legal perspective, the MiCA Regulation applies directly in all EU member states. The Polish Crypto-Assets Market Act was therefore not meant to create the rules governing the market from scratch. Its task was solely to establish the national supervisory system, the powers of the Polish Financial Supervision Authority (KNF) and the administrative procedures needed to apply the EU regulation. However, a problem arose when some of the solutions adopted by the Polish legislator went well beyond the mere implementation of MiCA.
Article 1(1) of the Crypto-Assets Market Act stated that it regulates the detailed rules for conducting crypto-asset activity, civil liability and the organisation of market supervision. Unfortunately, the way many provisions were worded raised serious constitutional concerns, which ultimately led to the presidential veto.
Why did the President of Poland veto the Crypto-Assets Act?
The President of Poland refused to sign the Act and referred it back to the Sejm for reconsideration under Article 122(5) of the Constitution of the Republic of Poland. The reasons given for the veto identified several fundamental legal problems which, in the view of the head of state, breached constitutional standards.
The first objection concerned disproportionately high supervision costs imposed on businesses. The provisions of the chapter regulating the financing of supervision (Article 77 et seq. of the Act) provided for fees payable to the KNF depending on the scale of the activity carried out. In the President's view, their structure could lead to a situation in which crypto businesses would be burdened more heavily than entities operating on the traditional capital market. Such a solution raises doubts from the standpoint of the principle of proportionality under Article 31(3) of the Constitution of the Republic of Poland.
In addition, the reservations concerned the excessive discretion of the supervisory authority when applying the most severe instruments of interference in business activity. The President stressed that the regulations needed to implement MiCA should respect the constitutional guarantees of economic freedom and property rights. Below we set out the key problematic areas of the Act.
Register of internet domains - the risk of censorship
Articles 67-70 of the Act provided for the creation of a Register of Internet Domains, maintained by the KNF, used for activity infringing MiCA. In practice, they allowed a domain to be entered in the register and telecommunications operators to be required to restrict access to the websites indicated. The President pointed out that concepts such as "infringement of the provisions of Regulation 2023/1114" or "risk of causing serious harm to clients" left the administrative authority too much interpretative freedom, which could breach freedom of economic activity and freedom of communication.
Blocking of crypto accounts without judicial review
Article 63 of the Act gave the Chair of the KNF the power to issue demands for the blocking of crypto-asset accounts or cash accounts. A block could be enforced even before the administrative proceedings were finally concluded, which meant that a business or client could be temporarily deprived of access to funds without prior judicial review. Such a solution constitutes a serious interference with the constitutionally protected right of property.
The consequences of the veto - what does the current situation mean for the crypto industry?
The consequences of the presidential veto and many months of regulatory uncertainty are already being felt on the Polish market. The exchange FlyingAtom announced a temporary suspension of operations from 1 July 2026, citing the impossibility of continuing to operate amid legal chaos. This is not an isolated case - hundreds of businesses involved in cryptocurrencies, blockchain and financial technologies have scaled back their activity, moved it abroad or withdrawn from the Polish market altogether.
It is worth stressing that the problem does not stem solely from the veto itself. For many months, the industry has been flagging the following difficulties:
- No clear transitional provisions governing the status of entities already operating on the crypto market
- Legislative delays in implementing the MiCA Regulation into the Polish legal order
- Uncertainty about the licensing process required by MiCA for crypto-asset service providers (CASPs)
- The risk of excessive financial burdens linked to supervisory fees payable to the KNF
- A lack of dialogue between the legislator and representatives of the blockchain industry
The veto has merely exposed problems that have been building for some time. For many business owners, however, it means further months of operating in a legal vacuum, which makes it impossible to plan investments and grow their business in Poland.
How to fix the Act - key demands of the industry and legal experts
The presidential veto does not signal opposition to the MiCA Regulation itself. On the contrary - the reasons given repeatedly stress that the EU rules are needed and can have a positive effect on the development of the market. The problem lies solely in the way the Polish implementing provisions were constructed. For the new version of the Act to be consistent with both the spirit of MiCA and constitutional standards, the legislator should in particular:
- Clarify the grounds for blocking internet domains (Articles 67-70), eliminating the excessive discretion of the supervisory authority
- Limit the possibility of blocking crypto accounts (Article 63) solely to situations confirmed by preliminary judicial review
- Adjust supervisory fees to the real scale of business activity, respecting the principle of proportionality
- Ensure effective and swift remedies against KNF decisions, including the possibility of obtaining judicial interim relief
- Hold transparent consultations with industry representatives, financial law experts and the blockchain community
The crypto-asset market needs stable and clear rules of the game. Without them, businesses cannot plan investments or grow their activity in Poland. A continued lack of precise regulation may lead to the loss of a significant part of the digital innovation sector, which only a few years ago was among the fastest-growing branches of the Polish economy.
Do you need legal support with crypto-asset regulation?
The current legal situation raises a number of questions for crypto and blockchain businesses about their continued operation, the licensing obligations arising from MiCA and protection against possible supervisory action by the KNF. Whether you run a crypto exchange office, an exchange platform or are developing a blockchain-based project, professional legal assistance is now essential to navigate the maze of changing regulations safely.
Contact our firm for an individual legal analysis of your situation. We will help you understand the regulations currently in force, prepare for the entry into force of the new version of the Act and safeguard your company's interests during the transitional period. Do not wait for the rules to decide for you - act proactively.
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