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Crypto License in Lithuania

 

AMS Europe provides specialized services for organizations aiming to enter the cryptocurrency and FinTech sectors within Lithuania – a jurisdiction renowned for its forward-thinking approach in the European Union and globally. Our expertise lies in facilitating the acquisition of licenses for conducting cryptocurrency activities in Lithuania, positioning you to deliver premium services in the realm of cryptocurrency and digital assets to your clientele. Partnering with us ensures you have a steadfast ally dedicated to guiding you towards success in this swiftly advancing industry.

About Crypto License in Lithuania

Lithuania has emerged as a favorable destination for cryptocurrency businesses seeking to establish a regulated presence in the European Union. The country offers a clear regulatory framework for crypto license registration, making it an attractive jurisdiction for startups and established companies alike. Lithuania's progressive approach to cryptocurrency and blockchain technology has positioned it as a leading hub for crypto innovations within the EU.

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General Overview: The Lithuanian Financial Market Authority, known as the Bank of Lithuania, oversees the regulation of crypto-related activities in the country. Lithuania distinguishes itself with a straightforward and efficient regulatory process, aimed at fostering innovation while ensuring consumer protection and adherence to international standards of financial transparency and anti-money laundering (AML) compliance.

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License Type:

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  1. Crypto Wallet Service License: This license allows companies to provide crypto wallet services, where they generate or store encrypted keys on behalf of their customers for the purpose of holding, storing, and transferring virtual currencies.

  2. Crypto Exchange License: This license is for businesses looking to offer exchange services between cryptocurrencies and fiat currencies, as well as between different cryptocurrencies.

Advantages to Open a Crypto Company in Lithuania

Favorable Regulatory Environment

Lithuania offers a clear and comprehensive regulatory framework for cryptocurrency businesses, which simplifies the process of operating within legal boundaries. The country has been proactive in developing regulations not just for cryptocurrencies but also for blockchain technology, positioning itself at the forefront of technological regulation in Europe​​.

Competitive Costs

Compared to other European countries, establishing a cryptocurrency company in Lithuania is relatively affordable. The country benefits from a low corporate tax rate of 15%, alongside a lower cost of living and operational expenses​​.

EU Membership

Being part of the European Union, Lithuania provides crypto businesses access to a vast market of over 500 million consumers. EU membership ensures that Lithuania’s regulations and standards align with those of the EU, facilitating easier cross-border operations for companies​​.

Efficient Licensing Process

Lithuania is known for its straightforward and efficient crypto licensing process. A company can be set up remotely without the need for a visit. Lithuania's approach significantly reduces the time and effort required to start operations​​.

Supportive Ecosystem for Startups

The country boasts a vibrant startup ecosystem, offering numerous co-working spaces, incubators, and accelerators that support and provide resources to startups. Additionally, significant investment in digital infrastructure makes it conducive for businesses to thrive online​​.

Access to Crypto-Friendly Financial Services

Although traditional Lithuanian banks may not work with crypto companies, Lithuania offers access to crypto-friendly fintech banks operating under the EMI license. This ensures that businesses can secure financial services tailored to their needs, including SEPA and SWIFT transactions​​.

Requirements for a Crypto License in Lithuania

The requirements for obtaining a crypto license in Lithuania are designed to ensure the integrity and security of financial transactions and include:

 

  • Business Entity and Registration: A limited liability company (UAB) must be established in Lithuania. This entity can operate remotely, without the need for a physical visit to Lithuania for setup. The minimum share capital for general company setup is 1,000 EUR, but for Virtual Asset Service Provider (VASP) activities, a capital injection of 125,000 EUR is required.

  • Detailed Business Plan and AML Policies: The application process involves providing a detailed description of the planned business model and licensed activities. Additionally, adherence to Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations is mandatory, and businesses must maintain an up-to-date overview of all clients and transactions. Companies must appoint a Money Laundering Reporting Officer (MLRO) who is a Lithuanian resident, with professional experience and the necessary documentation to prove their suitability​​.

  • Appointed AML Officer: From November 2022, the regulations specify that the VASP company must appoint a senior manager as the MLRO. This position must be filled by a Lithuanian resident. Outsourcing for AML compliance and reporting requirements is recommended, including roles such as Money Laundering Compliance Officer (MLCO) and MLRO​.

  • Proof of No Criminal Record: Each participant in the licensing project must provide a valid copy of their passport and a non-criminal certificate from the registry of convictions. This documentation is essential for the review and preparation of the licensing application​.

  • Minimum Required Capital: As mentioned, the minimum required capital for VASP activities is set at 125,000 EUR. This ensures the company's financial stability and compliance with regulatory requirements​.

  • Taxation and Banking Advisory: Virtual currency exchange services are not subject to VAT. However, services invoiced in virtual currencies follow regular VAT rules. Corporate profits are taxed at 15%, with potential reductions for small companies. It's also important to note that traditional Lithuanian banks typically do not work with crypto companies, so alternative banking solutions, especially those licensed for EMI, are recommended​​.

Product Plans

We provide a complete suite of services for acquiring crypto licenses in Lithuania, encompassing end-to-end support throughout the registration journey. Our seasoned experts guide you in securing all requisite documents, crafting robust Anti-Money Laundering (AML) and Know Your Customer (KYC) policies, alongside offering ancillary services like accounting, legal address provision, and meticulous preparation of essential documentation. Our mission is to streamline and accelerate the crypto license registration process in Lithuania, minimizing bureaucratic hurdles while guaranteeing thorough adherence to all regulatory mandates.

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1

Basic

  1. Company registration

  2. Crypto licence registration

  3. AML/CFT policy preparation

  4. Appointing an MLRO

  5. Registering an MLRO at FCIS

  6. Legal address for 1 years

2

Standard

  1. Company registration

  2. Crypto licence registration

  3. AML/CFT policy preparation

  4. Appointing an MLRO

  5. Registering an MLRO at FCIS

  6. Legal address for 1 years

  7. Bank account

3

Full

  1. Company registration

  2. Crypto licence registration

  3. AML/CFT policy preparation

  4. Appointing an MLRO

  5. Registering an MLRO at FCIS

  6. Legal address for 1 years

  7. Bank account

  8. Accounting services

Timeframe for Registration of Crypto License in Lithuania

The timeframe for obtaining a crypto license in Lithuania varies depending on the approach you choose for your business setup. Here's a summary based on the options available:

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  1. Registering a New Company for a Crypto License: The process can take between 5 to 8 weeks. This involves registering a new company specifically for obtaining the crypto license and includes steps like company registration, legal address setup, opening a bank account for share capital, and AML/CFT policy preparation​.

  2. Purchasing a Ready-Made Company with a Crypto License: If you opt for a ready-made company, the process can be significantly shorter, ranging from 2 to 3 weeks. This option is suitable for those looking to start their business quickly and willing to purchase a company that already has the necessary license and share capital in place​.

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Each of these options requires compliance with local regulations, including appointing an MLRO (Money Laundering Reporting Officer) who is a permanent tax resident of Lithuania, and adhering to strict AML/CFT policies​​.

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The choice between registering a new company or purchasing a ready-made one depends on your business needs, budget, and how quickly you want to start your operations. Lithuania offers a crypto-friendly regulatory environment, making it a favorable jurisdiction for such ventures.

Step-by-Step Procedure of Crypto License Registration in Lithuania

The procedure for registering a cryptocurrency operations license in Lithuania involves several important steps that need to be carefully completed to successfully obtain permission to conduct cryptocurrency business. Here is a step-by-step process that will help you understand the registration procedure:

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  1. Form a Legal Entity: The initial step is to set up a limited liability company (UAB) in Lithuania. This requires at least one shareholder and one director, who can be the same person. There are no restrictions on the nationality or residence of these members​.

  2. Reserve Company Name: Select and reserve a company name through the Lithuania Register of Legal Entities​​.

  3. Preparation of Required Documents: We will prepare various documents, including the company's Articles of Incorporation and Business Plan. It is also required to provide the personal information of directors and shareholders. The documents must be translated into Lithuanian.

  4. Register with the Lithuania Register of Legal Entities: We will submit the necessary incorporation documents for official approval. Following approval, you will receive your company's Certificate of Incorporation and other corporate documents​​.

  5. Open a Corporate Bank Account: An account must be opened with a financial institution in Lithuania, where the company’s authorized capital of €125,000 must be deposited​​.

  6. Prepare and Submit License Application: Documents required include passport copies, CVs, and proof of no criminal record for directors, shareholders, and beneficial owners, as well as AML/CFT procedural documents and the company formation documents​.

  7. Meet Economic Substance Requirements: Appoint a local AML/CTF Compliance Officer and possibly other employees to fulfill local regulatory requirements. The compliance officer is crucial for ongoing compliance with AML/CFT policies​​.

  8. Submission of the License Application: We submit the complete application to the Lithuanian regulator. You may need to attend an interview with the regulator as part of the approval process​.

  9. License Issuance: Upon approval, the company can start its operations.

What is Required after Registering a Crypto Company in Lithuania?

After registering a crypto company in Lithuania, there are several key requirements and steps you need to follow to ensure compliance and successful operation:

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  1. Compliance with AML/CFT Regulations: You need to maintain comprehensive AML/CFT and KYC policies and systems. This includes appointing a dedicated AML officer who is responsible for reporting to the Financial Crime Investigation Service (FCIS)​.

  2. Financial requirements: Your company should maintain the minimum share capital requirement, which is €125,000 for virtual asset service providers​​.

  3. Taxation: Understand and comply with the local taxation laws. Virtual currencies exchange services are not subject to VAT, but services invoiced in virtual currencies follow regular VAT rules. Corporate profits are taxed at 15%, with reduced rates available for small companies. Withholding tax on gross dividends is also applicable​​.

  4. Registration with Authorities: Your company must be registered with the Financial Crime Investigation Service (FCIS) and comply with all relevant legal and regulatory requirements​​.

  5. Maintaining Compliance: It is vital to continually monitor and ensure that your company complies with Lithuanian laws and regulations, including those related to the reputation of management, prohibition of anonymous accounts, and the requirement for conducting activities within Lithuania​.

  6. Data protection: For companies that handle the personal information of individuals residing in the EU, compliance with the General Data Protection Regulation (GDPR) is essential.

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Fulfilling these requirements will not only help in maintaining the legality of your crypto business in Lithuania but also contribute to its success and sustainability in the dynamic crypto market.

Frequently Asked Questions

What is a crypto license in Lithuania?

In Lithuania, a crypto license refers to the regulatory approval given by the Lithuanian Financial Market Supervision Service for companies to operate within the cryptocurrency space. This encompasses activities like cryptocurrency exchange services and wallet services. Lithuania has become a favorable environment for blockchain startups due to its clear regulatory framework, EU membership, and a progressive approach towards financial technologies.

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