For the record, the FSMA wishes to remind the public that the provision of exchange services between virtual currencies and legal currencies and of custody wallet services remains unregulated to this day, except for purposes of combating money laundering and terrorist financing (AML/CFT).
AML/CFT requirements were introduced into Belgian law by a Law dated 20 July 2020 transposing the Fifth Money Laundering Directive. This Law implemented a registration requirement for Virtual Asset Service Providers (VASPs) and designated the FSMA as the authority responsible for supervising their activities.
Providers already operating prior to the coming into force of the new legislation on 1 May 2022 were able to benefit from a so-called grandfathering scheme (organized by Royal Decree). Under that transitional scheme, already operating entities were permitted to continue their operations on a provisional basis until the FSMA had made a decision about their application to be enrolled in the register of VASPs, on the double condition of notifying the FSMA of the exercise of their activity before 1 July 2022 and of applying for registration as VASP before 1 September 2022.
Operating since 2018, Bit4You made use of this option and was therefore automatically included in the list of companies benefiting from a provisional authorization.
In reviewing Bit4You's application for registration, FSMA has taken all necessary steps to ensure that Bit4You complied with all requirements imposed by the Fifth Money Laundering Directive.
Bit4You had to change its entire governance structure in response to irregularities found by the FSMA in its application for registration. Following the subsequent insolvency of CoinLoan, Bit4You suspended its activities and ultimately withdrew its application for registration on 2 May 2023. As a result, it automatically lost the benefit of the provisional authorization. The FSMA had previously notified Bit4You of its intention to refuse its application for registration and had informed the Public Prosecutor of the irregularities found on the part of the former management.
More comprehensive, and in particular prudential, rules regarding crypto activities will be introduced by the European MiCA Regulation, that is expected to come into force in early 2025. In the meantime, warnings about the risks associated with the use of crypto-currencies issued by Belgian and European supervisory authorities (including the FSMA) remain applicable.