Understanding the requirements for a Lithuania Crypto License: What every business should know

Even though crypto exchange is becoming more and more accepted globally, it still needs to be legal in many countries.

Some still do not trust the decentralized nature of cryptocurrencies. While they are completely banned in some countries, others provide severe restrictions.

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However, certain countries have accepted crypto business, especially within the European Union. One of those countries is Lithuania.

The government of Lithuania recently passed an official statement on cryptocurrencies. The country will be allowing and regulating crypto businesses but with a license like https://inteliumlaw.com/gaming-license/curacao/. This makes it one of the few members of the European Union where trading crypto in any form is legal.

To conduct crypto business in the country, you need to have a Lithuania crypto license. This article offers insight into obtaining a crypto license in Lithuania.

Lithuania Crypto Regulations for Obtaining a Crypto License: Most Recent Updates

To start with, you need a limited liability company to apply for a crypto license in Lithuania. The new legislation of late 2022 allows businesses looking to trade in cryptocurrency. The legislation proves Lithuania has a clear understanding of future frameworks.

Businesses should have a share capital of 125,000 EUR. The goal is to ensure firms have enough financial resources to operate.

Also, it helps ensure that firms starting licensed cryptocurrency establishments maintain enough liquidity.

Despite the raised financial requirements, Lithuania is still far ahead of other countries. It has the clearest and most reasonable compliance obligations for crypto traders. It also appears like it is setting a precedent with regulations for other countries.

General Lithuania Cryptocurrency Regulations

The Financial Crimes Investigation Service may request certain information before issuing a license. This is about the comprehensive details of the crypto company seeking a license. This may include an in-depth description of the company’s activities during processing.

Also, here are other general regulations for obtaining a Lithuania crypto license:

• Post-Licensing Change Reporting

A company must report to the regulators any changes made after getting a license. It could be changes in the company’s structure or membership composition.

It can also include board member replacements and employee additions. The aim of these updates is to ensure transparency.

• Licensing Organization

The Lithuanian Business Register provides the license application paperwork. Then, the FCIS, an agency focused on financial crimes, oversees it. Both government agencies enforce the regulations guiding crypto activities in the country.

• KYC Regulations

The new regulations feature Order No. V-5 came in January 2020 to combat money laundering and terrorism financing.

This regulation outlines mandatory know-your-customer (KYC) identity procedures. The procedure aims at upholding financial stability and legitimacy.

How to Apply for a Crypto License in Lithuania: Licensing Procedure

Applying for a cryptocurrency business license in Lithuania is straightforward. All you need is to meet all the requirements. Here is a detailed process on how to get a crypto license in Lithuania:

• The first thing is to establish a Lithuanian business entity to apply for and hold the license. This business will be like a Limited Liability Company. It will serve as the licensed operating company the country recognizes.

• Next, ensure you have the regulatory 125,000 EUR capital fund to start your crypto business. This amount, meanwhile, must include liquid assets. However, VASP can still use formed share capital as operational funds.

• Once you settle funding, you need to get qualified staff. This person must be one who understands Lithuanian anti-money laundering and KYC regulations.

• Pay the application fees and get the license application form. Also, get all the information and documentation and then complete the forms.

• Regulatory supervisors will audit your firm through interviews and document reviews. They will also conduct inspections to confirm your compliance with every regulation.

• After satisfying the requirements and demonstrating full compliance, you will get a license. This is the final stage, and it grants you the legal freedom to conduct crypto operations in the country.

Documentation Requirements for a Lithuanian Crypto License

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You need to have certain important documentation ready before applying for the license. Below is the documentation the FCIS will need to review for a crypto license:

• A valid passport from your country

• A Power of Attorney if you will be operating from a virtual space

• AML/CTF policies

• A concise and clear business model – that is, what your company does

• A recent criminal record of your staff. This includes owners, board members, AML officers, and UBOs no less than three months old

• The information and professional experience of your staff – that is, their CVs and resumés

• Your service’s website address if you do business online

Luxuries Afforded By a Lithuanian Crypto License

Lithuania allows the exchange of cryptocurrency and crypto business. You must also get a license that is in line with the crypto regulations in place. Once you have fulfilled the requirements for getting a crypto license, all you need to do is wait.

With a crypto license in Lithuania, there is almost nothing you cannot do. You only need to ensure your activities are within the confines of the law. Thus, the advantages of having a crypto license in Lithuania include the following:

• Swift establishment and implementation of your planned crypto services and operations. This can take as short as two weeks after submitting all required documents.

• Freedom to enlist the help of consulting firms that are well-versed in setting up a compliant, licensed crypto entity.

Enjoy flexibility in the location of your company activities and your staff. With a license, it is not a must to have staff or physical offices in the country; they can work from home.

Nor do you need to have a physical office or business operations within the country, thus allowing for global mobility.

Conclusion

The process of obtaining a crypto license in Lithuania is straightforward. You need the right documentation to fulfill the requirements. More so, it is a crucial step to follow if you want to enter the crypto market.

Moreover, a Lithuanian cryptocurrency exchange license offers you many benefits. One of those benefits is access to the EU market and strong support from regulators.