Although Spain lacks regulations governing the cryptocurrency industry, the Commission Nacional del Mercado de Valores (CNMV), the body that oversees financial market regulations in the country, has taken up the role to oversee the crypto market. On Monday, November 18, 2019, CNMV blacklists one of the crypto companies offering an unregulated token, Ethereum-based AlyCoin.
The company’s token was added to CNMV’s warning list after it was established that if offers unregulated investments for citizens without the requisite authorization to operate in the country. CNMV claims that AlyCoin is soliciting its clients and offering them financial services against Article 17 of the Security Markets Law.
It is common for European regulators to give warnings against firms promoting cryptocurrency mining and other investments in the industry. In the past two years, CNMV has issued new rules regarding leverage requirement, trading cost and risk disclosure, and advertising requirements.
CNMV requires that all brokerage companies offering leverage higher than 10:1 should explicitly warn retail investors since such trades are associated with high risks. Exchange companies are also expected to priory inform their investors of the cost suffered in case they decide to close their trade immediately after opening it.
In a country lacking specific laws governing the crypto industry, the regulators have tried to give a definition of virtual assets expressly for purposes of AML laws. Spain’s legal framework does not offer any definition of cryptocurrencies. Still, CNMV and the central bank statements explain the crypto concept as ICOs and draw a line between utility and security tokens.