Hungary repeals strict crypto rules to align with MiCA

Hungary’s parliament has removed national validation checks for crypto conversions and repealed related criminal offences, including penalties of up to eight years’ imprisonment. The change was enacted through Act XXXVIII of 2026 on the Repeal of Certain Statutory Provisions Concerning Crypto-Asset Conversion Services after a vote on July 31; the law took effect on August 7.

Under the provisions struck from the Criminal Code (Act C of 2012), any exchange operating in Hungary had to pass a national validation process. Two offences were repealed. The first, ‘Abuse of crypto assets,’ criminalised unauthorised exchange of significant-value crypto-assets and carried penalties of up to two years in prison, rising to five years for particularly large cases. The second, ‘Unauthorized crypto-asset exchange service provision,’ made running exchange services without validation a felony punishable by up to three years, increasing to eight years in specific circumstances.

The repeal aligns Hungary’s domestic law with the EU Markets in Crypto Assets regulation, known as MiCA, which entered full application across the European Union on July 1. With the national validation requirement removed, crypto-asset service providers authorised under MiCA in other EU member states can operate in Hungary without seeking a separate Hungarian validation.

Katalin Horváth, partner at CMS Budapest, described the national provisions as ‘incompatible with the EU’s internal market and redundant with MiCA provisions,’ and recommended that payment institutions and crypto-asset service providers who had routed conversions to authorised validators unwind those processes. András Gaál, an associate at the law firm Schönherr, noted that converting crypto assets without prior validation had been classified as an unauthorised crypto transaction under the former regime.

Regulators and market participants have not issued formal operational guidance. Lawyers advising firms expect affected companies to update onboarding and compliance workflows to reflect reliance on MiCA authorisations and to remove Hungary-specific validation steps.