With the interest in cryptocurrency on the rise, every year, more and more companies start working in this direction. This sudden interest in cryptocurrency has resulted in many countries creating various rules in an attempt to regulate the industry. Amongst all the EU countries, Lithuania has been able to achieve excellent results. Here, cryptocurrencies are considered as a payment method, equated to electronic currencies. A crypto license obtained in Lithuania allows any organization to work throughout the European Union legally. Such a license allows an organization to work legally throughout the Europeans union and allows them to expand its customer base exponentially and enter a new colossal market that has a 20 percent share in the global economy.
Here you can important reasons why you should get a crypto license.
If you wish to simplify the process of obtaining a crypto license in order to carry out commercial crypto activities, we highly recommend contacting Gofaizen Sherle. Their specialists are extremely knowledgeable and are willing to provide you with full advice and help you with the paperwork.
Why Do Many Crypto Companies Choose Lithuania?
Nowadays, many companies are choosing this jurisdiction to obtain a license. This is because Lithuania has strived to create the necessary conditions and legal environment which are beneficial to the crypto industry. The country’s government is interested in developing the entire IT sector; therefore, it issues laws that soften the regulation of this industry, sets low tax rates, and in every possible way promotes the development of such a business.
Among the main advantages of getting a permit in this jurisdiction is:
- Low taxation and duties;
- High speed of receiving;
- Low requirements for the applicant;
- Lack of bureaucracy and corruption.
Lithuania is a country with a stable economy, where suitable conditions for business development are created.
How Long Does It Take to Get a License?
Lithuania has taken measures in order to provide a speedy procedure to obtain a license and beat all records in terms of speed, with the only other entities capable of competing being offshore companies with low reputations. On average, obtaining a license here in Lithuania takes about a month.
In order to obtain a permit to conduct commercial cryptocurrency-related activities, one needs a permit, which usually requires around 5 days, provided one has obtained and prepared all the documents required.
To get through this stage, you need to pay the fees, open a bank account and collect any additional papers that might be required in order to make sure that your organization meets all the requirements of the regulatory authorities. If entrusted to professional lawyers, you can get the whole process done within a week.
The last stage is certainly the longest. Once your organization is ready to be licensed, you will be able to apply to specific regulations. Typically, your application will be reviewed in 14 days, after which a decision will be made.
Requirements for the Applicant
Lithuania does not impose any strict requirements for crypto companies. The primary and decisive criterion is the level of trust that the organization has. You may not be able to obtain a license if the owner or at least one of the shareholders has previously faced problems with the law or has been accused of fraud.
Apart from that, other requirements include:
- Availability of authorized capital in excess of 2500 euros;
- The company must have employed at least 2 people (founder and shareholder);
- The company staff must include a security specialist (maybe a shareholder);
- Proper KYC policy must be followed;
- The organization needs to have a viable business plan.
Your company needs to have at least one owner and at least one shareholder. A security specialist also needs to be employed by your company, who may also be a shareholder at the same time. With requirements like these, Lithuania is the perfect place to set up a crypto business for both large corporations and small organizations.
Given the nature of cryptocurrency, the security specialist must have an excellent reputation in professional circles, good education, and previous experience in similar positions. The duties of the security specialist will include monitoring the company’s work and preventing fraud on the part of both employees and customers. They will have to prepare reports regularly on the activities of the company in order to comply with the regulatory authorities. This duty needs to be done without fail and must be done correctly, as failure to do so might result in the loss of your license in the event of an inspector finding any discrepancies or errors. If your organization loses its license, it will be impossible to get it again, because, in Lithuania, trust is the primary and decisive factor when it comes to the granting of licenses.
Your company must have stringent KYC (Know Your Customer) procedures to ensure the information on any of their customers. Any accounts created by these customers must be verified and users need to provide proof of identity to prevent any illegal activities. Your organization must not serve people who have a previous history of involvement in any form of fraud or money laundering. Regulators will need to have access to customer information as well.
It is imperative for your company to have a sound and viable business plan. Any and all information about the company’s activities, the services it plans to provide, the source of its funding, and other relevant information must be documented within the business plan. We highly recommend contacting professional lawyers during the creation of this document as they are aware of the various legal intricacies involved and can successfully guide you throughout the creation of this document and can inform you about the points which require further attention.
If proper procedure is followed, all the necessary requirements are met, if professional lawyers have been consulted during the creation of vital legal documents, and the proper documentation is submitted on time, Lithuania tends to be the fastest country to grant a crypto license to potential organizations looking to start their business in Lithuania.