Cyprus is positioning itself as a safe, innovative and internationally credible investment destination, underpinned by a fully EU-harmonised regulatory framework and strong cross-border cooperation, according to Dr. George Theocharides, Chairman of the Cyprus Securities and Exchange Commission (CySEC).
Speaking at the Cyprus–India Business and Investment Summit in Mumbai, organised by IMH in collaboration with Invest Cyprus, Theocharides outlined the vision, scope and supervisory approach of CySEC, stressing that trust, innovation and investor protection lie at the heart of Cyprus’s securities market.
“At CySEC, our vision is to enhance Cyprus’ securities market and make it one of the safest and most reliable destinations in Europe and internationally for investment,” he said, adding that this is achieved by “fostering trust amongst the firms we regulate and the investors they serve, through supervision, continuous innovation and ongoing education.”
EU-aligned framework and international cooperation
Theocharides emphasised that Cyprus’s securities market operates within a legal framework that is fully aligned with EU directives and regulations, allowing the regulator to effectively supervise new products and services as financial markets evolve.
“In today’s globalised and highly interlinked financial markets, CySEC has maintained close cooperation with other National Competent Authorities in Europe and worldwide,” he noted, highlighting the importance of exchanging expertise, assistance and best practices.
Theocharides also pointed out that CySEC is an active member of the European Securities and Markets Authority (ESMA) and the International Organization of Securities Commissions (IOSCO), contributing to regulatory convergence across European financial markets. Particular emphasis was placed on cooperation with India’s supervisory authorities.
He explained that CySEC works closely with India’s Securities and Exchange Board of India (SEBI) and the International Financial Services Centres Authority (IFSCA) under the IOSCO Multilateral Memorandum of Understanding, as well as a dedicated AIFMD Memorandum of Understanding with SEBI.
“These agreements set out a clear framework and close collaboration procedures which facilitate the exchange of information between Supervisory Authorities for better cross-border supervision,” Theocharides said, adding that discussions are underway for enhanced bilateral cooperation with IFSCA.
A diverse and expanding market
Turning to the structure of the Cypriot market, Theocharides revealed that CySEC currently regulates 808 licensed entities, spanning investment firms, fund managers, fund administrators, corporate services providers, issuers, crypto-asset service providers and crowdfunding platforms.
He highlighted the prominence of Cyprus Investment Firms (CIFs), with 252 licensed under the MiFID II regime, nearly half of which are fintech companies offering services online worldwide.
“This has created a unique financial sector that has enhanced economic growth and employment and transformed Cyprus into a thriving financial technology and innovation centre in the Eastern Mediterranean Region,” he said.
Theocharides also talked about how Cyprus’s investment funds sector has also expanded significantly following regulatory modernisation, growing by approximately 200% since 2016 to reach €11.4 billion in assets under management. CySEC supervises 298 fund management companies and funds, including a large number of Registered Alternative Investment Funds (RAIFs).
Recent legislative reforms have further clarified fund administration activities, with Theocharides stressing that only licensed Investment Fund Administrators are now permitted to perform UCITS administration functions within or from Cyprus.
Innovation, crypto regulation and sustainability
Addressing technological change, he noted that CySEC launched its Innovation Hub in 2018, which evolved into a full Regulatory Sandbox in 2024.
“Today, it serves as a comprehensive framework where innovative financial products – including crypto assets and tokenised solutions – can be tested responsibly under CySEC’s guidance,” Theocharides said, describing it as an example of regulatory agility combined with robust oversight.
CySEC also supervises crypto-asset service providers under the EU’s Markets in Crypto-Assets Regulation (MiCAR), in force since January 2025, which Theocharides described as “a major step forward for the protection of investors in financial markets across Europe”.
Sustainability was identified as another strategic priority, with CySEC developing an action plan for sustainable finance focused on compliance with ESG requirements and supporting the transition to a greener economy.
Risk-based supervision and advanced technology
Theocharides concluded by outlining CySEC’s supervisory approach, which is risk-based and supported by on-site inspections, thematic reviews and enhanced AML oversight. The regulator is also investing heavily in RegTech solutions, including artificial intelligence, cloud computing and big data analytics.
“These new procedures and methodologies will enhance our ability to oversee the compliance of regulated entities by automatically detecting potential risks and irregularities at an early stage,” he said.
In his closing remarks, the expert reaffirmed Cyprus’s commitment to playing an active role at national, European and global level.
“We continue to contribute at National, EU and Global level to give Cyprus a strong voice, and we do this within the framework of EU regulation through ESMA and our continued participation in international decision-making forums,” Theocharides concluded.
