Legal Documents

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Senit Pay Ltd Regulatory Status

Senits services are fully compliant with Money Laundering, Terrorist Financing and Transfer of Funds regulations and it is currently in the process of applying for Regulatory approval under the 5AMLD in the UK, a Crypto Currency licence in Europe and a Canadian Money Handlers licence. We believe that combined, these services will provide a protective umbrella for users on our platform, and enable us to serve them in the best way possible by ensuring that we comply with all local regulations.  


1. Crypto Asset Registration in the UK

From 10 January 2020, the FCA became the anti-money laundering and counter terrorist financing (AML/CTF) supervisor for these types of firms, which includes firms that exchange money to and from cryptoassets and those that safeguard their customers’ cryptoassets. From this date, ‘existing cryptoasset businesses’ (ie firms operating immediately before 10 January 2020) have had to comply with the Money Laundering Regulations; such firms were required to be registered with the FCA by 10 January 2021.

New businesses (who began operating after 10 January 2020), are required to obtain full registration with the FCA before conducting business. The Temporary Registration Regime is for existing cryptoasset businesses which have applied for registration before 16 December 2020, and whose applications are still being assessed. This is to enable those existing businesses to continue to trade after 9 January 2021 until 9 July 2021, pending the FCA’s determination of their application.

The FCA was not able to assess and register all firms that have applied for registration, due to the complexity and standard of the applications received, and the pandemic restricting the FCA’s ability to visit firms as planned. Many cryptoassets are highly speculative and can therefore lose value quickly. The FCA does not have consumer protection powers for the cryptoasset activities of firms. Even if a firm is registered with the FCA, we are not responsible for ensuring cryptoasset businesses protect client assets (ie customers’ money), among other things.

2. European Crypto Currency Licence

Cryptocurrency regulations in Estonia are open and innovative, especially in comparison to other EU member-states. Although not accepted as legal tender, Estonia’s government regards cryptocurrencies as “value represented in digital form”: accordingly, it classifies cryptocurrencies as digital assets for tax purposes but does not subject them to VAT. In 2017, the Anti Money Laundering and Terrorism Finance Act introduced robust new regulations for crypto businesses operating in Estonia.

Cryptocurrency exchanges are legal in Estonia and, following amendments to AML/CFT legislation in 2017, have operated under a well-defined regulatory framework that includes strict reporting and KYC rules. In 2019, the Estonian government passed legislation to tighten licensing requirements and went further in 2020, asserting that virtual currency service providers would be treated in the same manner as financial institutions under the Money Laundering and Terrorist Financing Prevention Act.

In late 2020, the Estonian government revoked over 1,000 operating licenses after amendments to Estonian law rendered many cryptocurrency service providers non-compliant with regulations. Up until 2020, cryptocurrency exchanges in Malta had to obtain two licenses from the Financial Intelligence Unit of Estonia: the Virtual Currency Exchange Service License and the Virtual Currency Wallet Service License. After the recent tightening of AML controls the Estonian government merged these two licenses into the single Estonian Cryptocurrency Exchange License. Meanwhile, regulatory responsibility for monitoring and supervising the sector moved to the Financial Supervisory Authority.

A number of crypto initiatives with potentially significant regulatory consequences have been mooted in Estonia, including a speculative government plan to introduce a national cryptocurrency known as “estcoin”. After EU criticism, Estonia’s government stepped back from the plan but continues to examine ways to use the estcoin within a government “e-residency” program. Advancing its 2020 objectives, the Estonian Government Anti-Money Laundering Commission stated that it would focus on cryptocurrency oversight in 2021 with “a number of important regulatory changes” planned for the future, including enhancements to customer identification obligations, payments services, and record keeping.

3. Canadian Money Services Business Licence

The Canadian MSB License (Money Services Business) was amended in December 2001 and the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) has come into effect to deter financial crimes within the land of Canada.

With the aim of enhancing the regulatory framework for money services businesses, the act also serves to combat transnational crimes, particularly in money laundering and terrorist activities. Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, companies are required to register with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC). As of 1st June 2020, foreign money services businesses are also required to register with FINTRAC and thereby, comply with their reporting and record-keeping requirements.

Non-compliance with the Act may result in criminal or administrative penalties. Generally, non-compliance will be followed with an assessment by FINTRAC to determine a suitable response. Administrative monetary penalties are commonly used to address repeated non-compliant behavior, and facilitate future compliance with the Act. In extreme cases where non-compliance to the Act is extensive or otherwise deemed to be impossible, criminal penalties may ensue. Criminal penalties such as a fine or imprisonment can be issued under these cases.



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