The adoption of blockchain technology and asset tokenization is advancing at a rapid pace, but the real engine driving its global development is the existence of a clear, consistent and innovation-friendly legal framework.
Some countries have already established themselves as regulatory benchmarks, establishing specific rules for cryptoassets, DLT infrastructures and token issuance with legal backing. In this article we show you relevant information about blockchain regulation in the Czech Republic, which you can use as a guide if you are looking to operate internationally or evaluate different strategic locations.
Current legislation on blockchain and virtual assets in the Czech Republic.
MiCA Regulation (Markets in Crypto-Assets Regulation)
Establishes the EU’s first comprehensive legal framework for regulating cryptoasset issuers and service providers (CASPs). Covers stablecoins, utility tokens, electronic money tokens (EMTs), asset referenced tokens (ARTs), and custody or exchange platforms. Requires prior authorization, governance requirements, solvency, transparency, and user protection.
MiFID II (Markets in Financial Instruments Directive II)
Security tokens and derivatives on cryptoassets considered financial instruments are regulated under MiFID II. Platforms must be licensed as an investment firm, under control of the ČNB, and comply with transparency and investor protection rules.
Czech Anti-Money Laundering Act (Act No. 253/2008 Coll.)
Virtual asset service providers (CASPs) must register with the Finanční analytický úřad (FAÚ), the Czech financial intelligence unit. They must apply AML/CFT controls, including know-your-customer (KYC) processes, transaction monitoring and mandatory suspicious transaction reporting.
Cryptoassets Sandbox and DLT Pilot Regime in Czech Republic
Czech Republic participates in the European DLT Pilot Scheme, which allows operating blockchain-based market infrastructures for trading tokenized financial instruments. It also integrates the European Blockchain Sandbox, driving the tokenization of assets, EMT/ART stablecoins and DeFi solutions in secondary markets.
Tokenization makes it possible to digitally represent real-world assets through blockchain, but for it to have legal value, a regulatory framework recognizing this operation is essential. Czech Republic adopts its own approach, establishing specific rules for the issuance, custody or trading of tokens. In this block we explain how asset tokenization is regulated from a legal point of view, taking an advanced jurisdiction such as Czech Republic as an example.
Regulation of asset tokenization in the Czech Republic
Asset tokenization in the Czech Republic is based on the European regulatory framework. When tokens represent financial instruments, such as stocks, bonds or fund shares, they are regulated by the MiFID II Directive and under the supervision of the Czech National Bank (ČNB). These tokens require prior authorization for issuance and trading on regulated markets. Utility tokens and stablecoins EMT (electronic money tokens) or ART (asset referenced tokens) are governed by the MiCA Regulation.
Czech Republic participates in the European Union’s DLT Pilot Scheme, which enables the development of blockchain-based market infrastructures for trading tokenized financial instruments. In addition, the ČNB collaborates in the European Blockchain Sandbox, supporting innovation in tokenization, stablecoins and DeFi applications.
In the case of tokenization of non-financial assets, such as real estate or art, there is no specific regulation in the Czech Republic, but it is recognized in private law. These tokens may be subject to civil, tax or consumer protection regulations, depending on their design. DLT registries have full legal validity in the country, providing security of transactions and ownership of tokenized assets.
National Bank of the Czech Republic (ČNB)
The Czech National Bank is the main authority regulating cryptoassets in the Czech Republic. It supervises CASPs under the MiCA Regulation, authorizes token issuance and activity of exchanges and custodians, and applies MiFID II to security tokens. In addition, it leads Czech participation in the European DLT Pilot Regime and the European Blockchain Sandbox.
Financial Analysis Office (FAÚ)
FAÚ is the Czech financial intelligence unit. It monitors compliance with national legislation on the prevention of money laundering and terrorist financing (AML/CFT), manages the CASP register, controls KYC processes and receives suspicious transaction reports. It works closely with the ČNB to protect the integrity of the financial system.
Ministry of Finance of the Czech Republic
The Ministry of Finance is responsible for the transposition of the European directives AMLD5 and AMLD6, and for the adaptation of the Czech legal framework for blockchain and cryptoassets. It participates in the development of policies that encourage innovation in DLT technologies and in strengthening the legal framework for the digital economy.
Launching a business based on digital assets requires more than just technology: it is also necessary to comply with legal requirements such as licensing, registration and regulatory obligations. These conditions ensure that the business model is viable and sustainable over time, and that it meets transparency and fraud prevention standards. In this section we explore what licenses are typically required and what compliance criteria blockchain companies operating in the Czech Republic must follow.
What licenses and requirements are needed to trade cryptoassets in the Czech Republic?
CASP License (MiCA)
With the entry into force of the MiCA Regulation in the EU, all cryptoasset service providers operating in the Czech Republic (exchanges, custodians, issuers of EMT or ART stablecoins, staking platforms, etc.) must have a CASP license. The competent authority for granting this license is the Czech National Bank (ČNB), which oversees compliance with the MiCA Regulation in the country.
Investment Firm License (ESI)
If a platform in Czech Republic offers derivative products whose underlying are cryptoassets (e.g. futures, options, CFDs), such products are considered financial instruments. Accordingly, the operator must obtain a license as an Investment Firm under the MiFID II Directive. The Czech National Bank (ČNB) is responsible for granting this license and supervising the activity of these platforms.
AML/KYC Compliance
Companies operating in the cryptoasset sector in the Czech Republic are required to comply with the National Act on the Prevention of Money Laundering and Terrorist Financing, which incorporates AMLD5 guidelines. Requirements include customer identification and verification (KYC), constant monitoring of transactions, identification of beneficial owners and reporting suspicious transactions to the Financial Analysis Office (FAÚ).
Other regulatory requirements
In addition to MiCA and AML/CFT, cryptocurrency companies in the Czech Republic must comply with the DORA (Digital Operational Resilience Act) Regulation. This involves implementing technology risk management (ICT) policies, establishing cybersecurity procedures, maintaining operational continuity plans and performing digital resilience testing. It is also necessary to monitor external technology providers and adequately train staff in digital security.
Are you exploring developing your blockchain project in the Czech Republic?
At Metlabs we help companies like yours and offer comprehensive support in the development of blockchain projects and tokenization of assets such as real estate, carbon credits, commodities, intellectual property, financial instruments, franchises and more, fully aligned with the blockchain regulation in Czech Republic and international regulatory standards.
Contact us and find out how we can help you meeting all your business model needs, from technical validation and structuring to design, development and implementation of custom blockchain solutions, ready to scale from day one.