Are you looking for somewhere cost effective and easy to obtain a Cryptocurrency Exchange License?
If so (as an alternative to Estonia) you might want to check out the Lithuanian Cryptocurrency Exchange option.
Being recognized as a traditional finance jurisdiction within the European Union and European Economic Area (EU/EEA), Lithuania recently introduced a regime for the set up and Licensing of Cryptocurrency Exchange and Cryptocurrency Depository Wallet operator enterprises making it one of very few European Union (EU) members states with virtual currency licensing and authorization procedures.
Types of crypto activity authorization
There are 2 types of cryptocurrency business license one can obtain in Lithuania :
– Crypto currency exchange operator is a company or the affiliate of a company exchanging cryptocurrency owned by the client for a commission fee
– Crypto currency depository wallet operator is a company or the affiliate of a company managing client cryptocurrency depository wallets
The activities of the cryptocurrency exchange and cryptocurrency wallet provider need to be separated from the licensed financial activity (payment and electronic money institution, bank, etc.). Nevertheless, licensed financial institutions are allowed to serve the fiat payments of the crypto dealing companies and their clients creating an effective vehicle for crypto-fiat payments.
Unlike Estonia – which has recently brought in local substance requirements – (ie to obtain/hold a Cryptocurrency Exchange License in Estonia you now need to have a local office, local/resident Compliance Manager & a Management Board Member on the ground), in Lithuania there are no such specific requirements as in Estonia. Hence, the setup of a Cryptocurrency Exchange in Lithuania can be completed in a simpler manner in terms of both set-up and on-going costs.
For Lithuania, in terms of set up costs, you would need to budget to spend around 12,000 Euros. On-going fees can be kept to a minimum as no specific requirements for local personnel or office exist to date. We can also support with full service compliance, including local AML officer services as required. (OCI has a representative office in Lithuania and can provide full setup/support in Lithuania should you decided to apply for a Crypto Exchange and/or etc license there).
Initial Coin Offering ICO registration for token distribution in Europe
Initial Coin Offerings (ICOs) and token distributions to investors in Europe will require specific authorization. Separate AML/KYC and other reporting requirements apply to any Lithuanian company carrying out ICO activities or attracting financing through the public distribution of tokens and virtual coins to investors. Lithuanian registered legal entities (companies) as well as Lithuanian registered affiliates of EU and non-EU companies are allowed to register and publicly distribute virtual coins offering them to the investors in all EU/EEA area.
AML/KYC requirement for the companies holding cryptocurrency authorization
Lithuanian registered legal entities (companies) and Lithuanian registered affiliates of EU and non-EU companies can apply for Crypto authorization. Applicants need to have in place AML/KYC polices and implemented procedures necessary for the provision of cryptocurrency related activities. Cryptocurrency exchange and crypto currency depository wallet operators are supervised by the Lithuanian Financial Crime Investigation Unit – FIU.
Members of the Management Board as well as Ultimate Beneficial Owners (UBO’s) of the company need to meet the requirements of impeccable reputation. (ie a local spin on The Common Law equivalent of “Fit & Proper”). Conveniently, there is no requirement for directors or members of the board to be Lithuanian/European residents.
General requirements for any Lithuanian entities engaged in cryptocurrency activities:
– Customer identification and verification
– Reporting to Lithuanian FIU
– Record Keeping and client data
– Employment of Lithuanian AML officer
– Preparation of AML/KYC polices and implementation of internal control procedures
OCI Lithuanian cryptocurrency registration and authorization
OCI can provide the full range of cryptocurrency exchange and cryptocurrency depository wallet operator authorization services including company registration in Lithuania and preparation of all required AML/KYC policies and procedures.
After the authorization/registration/licensing process is complete we can also provide bookkeeping and Lithuanian FIU compliance services for authorized entities as/if needed.
Would you like to know more? Then please Contact Us:
DISCLAIMER: OCO Ltd are not Tax advisers or Legal Advisers. You should seek local tax, legal and financial advice before committing to set up an Offshore Corporate or Fiduciary Entity.