Lithuania currently offers price-effective cryptocurrency exchange and cryptocurrency depository wallet operator authorizations being one of few European Union (EU) member states having virtual currency licensing procedures. Lithuanian Crypto authorization currently considered as most liberal in all EU/EEA area.
Types of cryptocurrency registration
There are 2 main types of cryptocurrency authorization:
Crypto currency exchange operator is the company or the affiliate of another company exchanging cryptocurrency owned by the client for the commission fee
Crypto currency depository wallet operator is the company or the affiliate of another company managing client cryptocurrency depository wallets
Activities of the cryptocurrency exchange and cryptocurrency depository wallet operators needto be separated from the licensed traditional finance activity (payment or electronic money institution, etc.). Nevertheless, licensed financial institutions allowed to serve the fiat payments of the crypto registered companies and their clients creating effective vehicle for crypto-fiat payments.
Initial Coin and Exchange Offering ICO/IEO registration for tokens distribution in Europe
Initial Coin and Exchange Offering (ICO/IEO) and token distribution for the investors require a separate authorization. Separate AML/KYC and other reporting requirements are established for the companies carrying out ICO/IEO activities and attracting financing through the public distribution of tokens and virtual coins to the investors. Lithuanian registered legal entities as well as Lithuanian registered affiliates of EU and non-EU companies allowed to register and publicly distribute virtual coins offering them to the investors in EU/EEA area.
AML/KYC requirements for the companies holding cryptocurrency authorization
Lithuanian registered legal entities and affiliates of EU and non-EU companies can apply for the crypto authorization. Applicants need to have all necessary AML/KYC policies and implemented procedures necessary for the provision of cryptocurrency-related activities. Cryptocurrency exchange and cryptocurrency depository wallet operators are supervised by 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. There is no requirement forth the directors and members of the board to be Lithuanian/European residents.
Members of the Management Board as well as Ultimate Beneficial Owners (UBO’s) of the company need to meet the requirements of impeccable reputation.
General requirements for the entities engaged in cryptocurrency activities:
Customer identification and verification
Reporting to Lithuanian FIU
Keeping records and client data
Employment of Lithuanian AML officer
Preparation and implementation of AML/KYC policies and internal control procedures
ECOVIS experience in cryptocurrency registration and authorization
ECOVIS ProventusLaw provides a full set of cryptocurrency exchange and crypto currency depository wallet operator authorization services including company registration in Lithuania and preparation of all required AML/KYC policies and procedures. After the authorization process ECOVIS provides bookkeeping and Lithuanian FIU compliance services for authorized entities. ECOVIS also assist wit Bank and Electronic Money accounts opening for Crypto Companies.