Blockchain startups in the European region, especially Lithuania, are heavily expanding because this country provides ample services. For running such a business, where transactions of cryptocurrencies and conversion between digital currency to fiat currency are applicable, then a crypto license is a must.
Lithuania opened the door for blockchain startups and recently amended some rules in the crypto licensing process, especially in the matter of share capital. Another significant amendment introduced by the crypto regulating body is the formation of the Lithuania crypto license register which will keep the records of the companies having crypto licenses.
Crypto License In Lithuania – 2 Major Types
Crypto license in Lithuania https://inteliumlaw.com/crypto-license/lithuania/ comes in two major types, i.e., Crypto Exchange License and Crypto Wallet License. But before applying for any crypto license from Lithuania, you should have a Private Limited Liability Company (UAB) and an AML officer who should be a local resident. The detailed requirements will be covered later in this topic. Now, let’s see the types of crypto licenses that you can get from Lithuania.
Crypto Exchange License
This type of license will enable you to perform an exchange between FIAT currency and cryptocurrency and vice versa.
Crypto Wallet License
This license is also termed a crypto wallet custodian license where you will have the authority to retain cryptocurrency wallets for the companies you are offering services. Additionally, this license gives you the power to store the encrypted keys of your esteemed clients.
What Are The Benefits Of A Crypto License In Lithuania?
Lithuania is the hub of fin-tech companies and welcomes blockchain startups with their outstanding hospitality by offering licenses at low cost. In addition, the regulations are more inclined towards the companies so that they can spread their wings in the open sky easily. So, being an owner of a blockchain startup you will get a lot from this country, so let’s see the benefits of a crypto license in Lithuania.
Expand Business Across European Union Markets
The EU market is ideal for blockchain startups to grow their businesses and getting a crypto license from Lithuania will pave a path for you to walk seamlessly across the streets of this market. In short, one blockchain license will work in every European Union member state, and also the operational cost of running a business in Lithuania is very low which will help you to grow your business effectively.
Low Licensing Cost
The crypto license cost in Lithuania is lower compared to other countries and also the apex licensing body (FCIS) provides ample services in running a blockchain business. So, this is a big advantage for you to start a new blockchain business in this region.
Waiting Period Is Shorter
Lithuania offers a friendly atmosphere to companies so that they can flourish, so here the waiting time for issuing a license is shorter. After the submission of the application form and documents, the Bank of Lithuania will review your application and will forward the same to the Lithuania Business Register–A body that issues a license. This body is a subordinate of the Financial Crime Investigation Service (FCIS), so the entire licensing process is completed within a month.
Remote Facility
Lithuania provides a remote facility for establishing and obtaining a crypto license which means, you can establish a legal entity in Lithuania’s jurisdiction and apply for a license remotely. Moreover, a person from any country can apply for a crypto license which means domicile criteria are not a subject for a company’s owner.
Prerequisites For Obtaining A Crypto License In Lithuania
Before applying for a crypto license, you need to consider a few points to make your licensing process smoother and the same are provided below.
Appointment Of An AML Officer
A company applying for a blockchain license needs to follow a set of rules directed by FCIS as this business is heavily volatile because of the involvement of financial risks, such as money laundering. So the presence of an AML officer is a must who will execute Anti-Money Laundering (AML) policies. In addition, such a person should be a resident and taxpayer of Lithuania.
Registered Share Capital
As per the crypto license guideline, a company applying for a license must have a share capital of 125,000 euros. However, it is not essential to contribute the entire amount in a single phase, you can split them accordingly as per the local commercial code.
Clean Background Of Members Associated With Business
The key members associated with your blockchain business such as directors or shareholders should have no criminal record and have a good reputation in the business world.
What Is The Process To Obtain A Crypto License In Lithuania?
FCIS has simplified the licensing process intending to give ample space for blockchain startups so that they can evolve in a competitive market. So, let’s see the comprehensive ways to obtain a crypto license from Lithuania.
Establish A Legal Entity In Lithuania’s Jurisdiction
The first and foremost step that you need to take for obtaining a crypto license is to establish a legal entity in Lithuania and it is recommended to register for a Limited Liability Company (UAB).
Documentation Part
To get a crypto license from Lithuania, you need to focus on the documentation part as this phase is very important and crucial. However, for your convenience, the list of essential documents that are needed for obtaining a crypto license is provided below.
- A copy of the passport of all the key members associated with a business.
- A comprehensive business plan, including AML policies, rules, and regulations for conducting cryptocurrency activities.
- A copy of police verification of board members and AML officer.
- Company formation documents, including AOA (Articles of Association), Memorandum, and others.
Opening Bank Account
For running a business and depositing authorization capital, you need a bank account, so open a corporate bank account from a bank registered in Lithuania.
Submit Application Form
After filling out the application form and compiling all the essential documents, submit them to the local regulator.
Get A Crypto License
After the submission of your application form and documents, the regulator will examine them and if they are satisfied with the paperwork, then they will issue a license to you. However, the duration of this entire process will take around a month, so have patience.
Final Verdict
Lithuania is a fin-tech hub in European regions and also this country provides ample services to blockchain startups. So, getting a crypto license from Lithuania will help you to expand your business in the European market. All you need to follow the rules and regulations directed by FCIS and ensure to build customers’ trust by maintaining transparency and taking accountability.