The head of the financial regulatory department in Germany is stopping all the services & operations of a company named ‘KKT UG’ from Berlin that allows consumers to buy and sell cryptocurrencies at Bitcoin ATMs.

Lack of Necessary Permissions Lead to this Stopping

According to a statement released on 4th March, BaFin ordered Mr. Adam Gramowski, Managing Editor at KKT UG, to cease their every cross-border proprietary trading. The order was issued on Feb 26.

On its official website (www[dot]shitcoins[dot]club), the company advertises 24 bitcoin machines are now operational in Germany to accept the purchase and sale of cryptocurrencies. Additionally, its businesses are extended across the whole of Europe. As per his LinkedIn profile, Adam Gramowski is also CEO of Bitcoin Technologies in Torun, Poland.

According to BaFin, Gramowski is an active member of commercial proprietary trading via KKT UG, which requires a BaFin license under the German Banking Act (Kreditwesengesetz, KWG). However, the operator lacked the necessary permission for this which is why it moves towards stopping its operations and services in Germany.

Bitcoin ATMs in Germany Need the BaFin License to Remain Operational

Bitcoin ATMs have had gained uncertain status so far in Germany. The responsibilities here hadn’t been completely clarified until January 2020. On Sep. 25 of last year’s proceedings against Bitcoin-24 ( a popular bitcoin exchange operator in Germany), which has since been discontinued, the Berlin Court of Appeal (Kammergericht Berlin) ruled that commercial trading of Bitcoin without necessary licenses and permission of the authorities isn’t punishable.

The previously common practice of having the legal status of Bitcoin and other cryptocurrencies regulated by BaFin was declared illegal in that case.

In 2020, the German government decided to introduce new anti-money laundering regulations. Starting next year, cryptocurrency-related businesses such as digital exchanges, custodians and wallet providers will need a BaFin-issued license.

Therefore, companies dealing with crypto-assets need to hand in their applications by June 2020 but needed to signal their intention of applying for a license by February 2020.