Hungary Imposes Strict Crypto Regulations with Severe Penalties

Hungary has enacted a stringent new law targeting cryptocurrency operations, imposing prison sentences for unauthorized trading and exchange services. Effective July 1, 2025, the legislation criminalizes both individual traders and unapproved platforms, with penalties escalating based on transaction volumes.

Basic crypto transactions now carry a two-year prison term, while trades exceeding $140,000 face three years. Larger transactions over $1.4 million could result in five-year sentences. Unauthorized exchanges risk three to eight years imprisonment, depending on volume.

The law mandates rigorous state validation for all crypto exchanges, requiring strict identity verification, fund origin checks, and wallet ownership confirmation. Non-compliant conversions between crypto and fiat are deemed illegal.