President Karol Nawrocki’s veto on a controversial law to regulate the Polish crypto market has been met with threats and attacks by the government.

Prime Minister Donald Tusk has ordered an investigation into an alleged “crypto affair,” implicating the head of state, while members of his ruling coalition are accusing him of attending to Russian interests.

Halted Polish crypto bill stirs political storm in Warsaw

Poland is descending into a major political clash over Nawrocki’s decision to stop the Tusk cabinet’s attempt to impose legislation transposing the EU’s latest crypto rules into national law.

On Monday, the president vetoed the Crypto-Asset Market Act passed by the Polish parliament, which critics say is much harsher than Europe’s Markets in Crypto Assets (MiCA) regulation.

The local Bitcoin community has already warned it may literally kill crypto business in the country, and the recently elected Polish leader expressed additional concerns in his motives, including regarding Poles’ personal and economic freedoms and their state’s stability.

Tusk’s government counterattacked, alleging Nawrocki’s participation in a “crypto affair” and exposing his “weird relationship” with the digital asset industry, as reported by Bitcoin.pl portal.

“Everyone is already talking about a crypto scam. This involves a large company, lawsuits, investigations, suspected murder, the disappearance of the manager of a key crypto firm,” the prime minister stated, quoted by the RIA Novosti news agency.

He also saw a “political campaign” behind the president’s move and spoke about right-wing leaders and media advertising one of the investigated companies. On Tuesday, Tusk also lashed out in a post on X.

The head of the Polish government announced he had instructed his colleagues in the government to collect details on the case, stating:

“I expect the Minister of Finance to provide full information about the negative consequences of this veto, and I ask Ministers Siemoniak, Kerwiński, and Żurek for information about the context of this case and who is behind the blocking of this law.”

Tomasz Siemoniak is Poland’s coordinating minister of intelligence, Marcin Kerwiński is the head of the Ministry of the Interior, and Waldemar Żurek serves as minister of justice and prosecutor general.

Donald Tusk vowed to push the law through parliament again and resubmit it for signature from Nawrocki, whom he directly threatened:

“I ask you to treat this as your last chance to remove your name from the crypto scam, which has become a very public fact in recent days.”

Meanwhile, Deputy Prime Minister Gawkowski blamed the president for “blocking progress in digitalization.” And the government said the bill will be “immediately” sent back to Polish lawmakers to ensure protection for 3 million Polish investors, as Tusk insisted.

Ruling coalition alleges Russian connection in presidential veto

The Civic Coalition, which holds the executive power in Warsaw, went even further, with its representatives suggesting that Nawrocki’s halt of their legislative initiative actually serves Putin’s Russia, because Moscow is using cryptocurrencies to circumvent Western sanctions.

Bitcoin.pl, which registered the attack on social media, described the claim as “bold but misguided.” The crypto news outlet insisted that “a well-constructed law could block this without destroying the Polish Web3 ecosystem.”

The website pointed out that the proposed crypto law is “more than 100 pages of legislative nightmare, full of mistakes, ambiguities and bureaucratic barriers” that can “finish off” Polish blockchain businesses. It also commented:

“The president vetoed it not to defend fraudsters, but to give time to correct fundamental mistakes. It’s not a blocking of innovation, but an attempt to save it from the legislative molochs.”

The online edition called the moment critical for the Polish crypto market, arguably Eastern Europe’s largest within the EU, as it provides an opportunity to adopt rules that protect investors, without strangling entrepreneurs.

“If the bill passes in its current form, we are in for a massive exodus of companies and capital to more friendly jurisdictions,” the Bitcoin portal wrote, listing some of the more welcoming nations in Europe such as Estonia, Switzerland and Portugal, besides Poland’s Czech and Hungarian neighbors.

Claim your free seat in an exclusive crypto trading community - limited to 1,000 members.