Hungary plans repeal of crypto jail terms

TLDR

Hungary's new government plans to scrap harsh crypto rules that allowed jail sentences for certain trades and instead align its regulations with the EU's MiCA framework.

1. The 2025 law made many unapproved crypto transactions criminal offenses, with prison terms of up to eight years, but the government now says it will repeal these provisions.
2. The rules shrank Hungary's crypto market, pushed platforms like Revolut out, and triggered an EU probe, so their removal could reopen access for hundreds of thousands of users.
3. The key next steps are how quickly Parliament passes the rollback, how MiCA style rules are implemented, and whether major exchanges and fintechs re enter the market.

Deep Dive

1. What Hungary Is Changing

In 2025, Hungary amended its Criminal Code and a new Crypto Act so that most crypto to fiat and crypto to crypto trades needed a validation certificate from a licensed local provider. Transactions done without that certificate were branded "unauthorized crypto transactions," legally invalid and subject to criminal charges.

Penalties scaled with size. Unauthorized trades between roughly 5 million and 50 million forint could bring up to two years in prison, 50 million to 500 million forint up to five years, and above 500 million forint up to eight years, with separate penalties for unlicensed service providers, as summarized in a Hungarian press briefing reported via CoinsKid Community coverage.

Tisza Party government spokesperson Anita Kbl has now said these criminal provisions will be withdrawn and the transaction level validation requirement dismantled, with a shift toward an EU style MiCA framework instead, a move echoed in independent reports from outlets like Cointelegraph.

2. How The Old Rules Hit Crypto

Officials acknowledge the 2025 framework "made practical operations nearly impossible" and "frightened market participants," with several hundred thousand Hungarians reportedly affected by the risk of criminal liability.

Major platforms, including Revolut, suspended or scaled back crypto services in Hungary after the law came into force, and local trading volumes dropped sharply, according to multiple reports aggregated in this overview.

The European Commission also opened an investigation into whether Hungary's regime conflicted with EU law, adding pressure for change.

3. What To Watch Next

The announcement signals intent, but the repeal still needs to move through Hungary's legislative process and be written into updated statutes and regulatory guidance.

Authorities say they plan to harmonize with the EU's Markets in Crypto Assets rules, which focus on licensing, disclosures, consumer protection, and AML controls rather than jailing ordinary users for using "unauthorized" venues.

For crypto users and companies, the key signals will be:

1. when the criminal provisions are formally removed,
2. when MiCA style licenses are available in Hungary, and
3. whether large exchanges and neobanks resume full service.

Conclusion

Hungary is pivoting away from a uniquely punitive crypto regime toward an EU aligned, MiCA based model that relies on supervision rather than prison terms. If the rollback is implemented as described, it could reopen a medium sized Central European market, but the real test will be how quickly clear, workable rules replace the repealed criminal framework.