Lithuania crypto exchange & wallet license
Lithuania is now becoming one of the most crypto-friendly and attractive jurisdictions within the European Union, offering a friendly and regulated legal environment for virtual asset service provider (VASP) companies, with clear regulations in place since January 2020.
In comparison to its neighbouring destination Estonia, Lithuanian regulations can be viewed as more flexible in terms of the setup and come at lower on-going cost as there is no specific requirement for onsite personnel. Our extensive experience both in Estonia and Lithuania can be at your disposal if you like to work with professionals. The company and license setup can be fully processed remotely, with no travel required.
Our team of experts provide professional solutions for crypto exchange and wallet licenses setup.
Advantages
Simplicity
Low costs
Local resident members
Company’s director (CEO) citizenship
Taxes
Hiring local staff
Interview with Lithuanian authorities
Terms
Remote registration format
Types of crypto licenses for virtual currency operations
Cryptocurrency exchange license
A company with such a license is able to exchange digital currency for FIAT or vice versa, or cryptocurrency for another cryptocurrency, receiving a commission for the services provided.Crypto wallet and custodian services license
A company with such a license may operate customer wallet to store cryptocurrency including generating and storing encrypted client keys. A company can hold any or both the crypto exchange and wallet licenses. Both licenses granted are controlled by the Lithuanian Financial Crime Investigation Service (FCIS). Whichever the license you will be interested in, our Business Development Team will help and guide you applying for any of such licenses – Cryptocurrency exchange license and/or Crypto wallet and custodian services license.Crypto company structure
Companies in this cryptocurrency sector are subject to the several requirements, such as:
To apply for a cryptocurrency license, a limited liability company (UAB) must be incorporated in Lithuania to provide both cryptocurrency exchange and/or storage services;
The minimum requirement for a company’s authorised capital from November 2022, is €125.000 – but, it is important to know that the new Lithuanian legislation allows registering a crypto company without an authorized capital contribution in any amount at any time, despite the requirement of 125,000 EUR;
The establishment of a cryptocurrency company can be carried out either in person or remotely by proxy without the need to visit Lithuania;
At least one owner (natural or legal person);
One board member (may also be the owner);
Money Laundering Reporting Officer (MLRO) – From November 2022 requirement for local resident position with employment contract; 1 position per Lithuanian Crypto company; professional experience and fit-and-proper requirement;
Virtual office address accepted as company location. Beneficial owners’ details are disclosed to the authorities;
All clients must undergo a background check and identification procedure;
Customer data must be kept for eventual submission to its regulator;
The company ought to have internal control and risk assessment procedures;
Reporting to Financial Crimes Investigation Service – the regulator.
General provisions
All over the licensing process, the FCIS has the right to request additional information and detailed description of the proposed activity of the crypto currency company. Crypto license is usually issued only after all required information has been considered sufficient and all requirements have been met. Any eventual change on the cryptocurrency company structure, after license has been issued, such as address, ownership, board members, beneficiaries, AML officers and others, require respective filing of changes in the local Registrar.Taxation
- Services provided and accounts paid in virtual currencies are subject to normal VAT rules.
- Virtual currency exchange services are not subject to VAT.
- The cryptocurrency company’s profits are taxed at a rate of 15%. A micro company with less than ten employees and less than 300,000 euros of gross annual income may be taxed at a reduced corporate tax rate of 0-5%.
- Income tax (WHT) 15% is levied on distributed profits (dividends paid).
Procedures to apply for a crypto license in Lithuania
UAB company formation or purchase of a shelf readymade company for application purposes – it usually takes around 5 business days;
Prepare a notarized power of attorney in case of remote company registration in Lithuania;
Register in the Tax Office;
Taking care of all information and documents for application purposes – approx. up to 7 business days;
Submit an application to the AML bureau for the company entry in the register;
The application for license issuance will be processed by FCIS within 20 working days from the date application has been submitted.
Pricing for crypto license in Lithuania
TBA is ready to provide you excellent solutions for crypto exchange and wallet licenses, inclusive the possibility to process crypto license application remotely, with no physical presence required in Lithuania. Our business development team will take care of all legal procedures on your behalf.
Cryptocurrency license documents required for application purposes
Valid copy of passports of company officers;
Power of attorney: should you decide to go for a remote application;
Company detailed activity description;
Curriculum Vitae showing business experience and professional expertise of all officers directly engaged on the crypto related project;
Website address where cryptocurrency services will be offered;
Criminal records (not older than 3 months) for owners, board members, final beneficiaries (UBO) and AML officers of the company;
If required by FCIS, data of all ultimate beneficial owners (UBO);
An AML officer is absolutely required; this AML officer for the prevention of money laundering and terrorist financing must show professional experience and an excellent reputation (Lithuanian residence is not compulsory) – according to AML/KYC rules, each licensed company must keep a detailed and up-to-date overview of all customers and transaction;
Consent of all directors;
Confirmation of opening a bank account in Lithuania;
Additional information may be requested by government agencies during registration.
New requirements from November 2022
We would like to inform you that Lithuanian authorities have officially announced approaching changes in regulation of virtual currency exchange and depository operator activities. Hereby we delve into the upcoming requirements in greater detail and show its practical implementation, so that you have a clear understanding of Lithuanian VASP market situation and help you find the most suitable solution.
The following requirements will step into the force on 1 November 2022 for new applicants and on 1 December 2022 for already registered companies:
1. According to the current legislation of Lithuania, it is possible to obtain 2 separate registrations
In Lithuania it will remain activity registration (rather than a license) and the supervisory authority will be the Commercial Registry for compliance with formal requirements (availability of authorized capital; local exclusive AML officer, etc.). Lithuanian authorities will create a separate register for Virtual Asset Service Providers by Jan-Feb, 2023 and it will be possible to upload a separate printout and further apostille to present it to the Banks, counteragents and other third parties.
2. Currently, contributed share capital is in the amount of 2 500 EUR
As per new requirements:
- This share capital will be increased to 125 000 EUR;
- It will be allowed by the law to contribute only 31 250 EUR (25% of the initial share capital requirements) at the registration step;
- The amount of 31 250 EUR could be further withdrawn and used within the framework of the company’s activities;
- By the moment of submitting the annual report within 12 months after company incorporation, capital on the account should be not less than 50% (62 500 EUR).
Thus, the company’s equity capital cannot fall below 50% (62 500 EUR) at the moment of each annual report submission and further withdrawn and/or used within the framework of activities.
3. Currently, there is the requirement for an officially employed Money Laundering Reporting Officer (MLRO) and a non-local AML officer
As per new requirements:
- Instead of MLRO and non-local AML officer, VASP will be obliged to have an exclusive (work only for one company) local AML officer.
- As per our initial assessment, Lithuanian authorities will not verify the competence of a local AML officer (such as CV, diploma, etc. will not be requested by the regulatory authorities). This is the point which allows you to have plenty of different options of hiring AML officers with the experience and occupation you will be satisfied with.
4. Currently, Director and UBO of a company do not have to be a locals
Requirements will remain the same.
5. To date, Director and UBO of a company should have a good reputation
6. To date there is no need to have a physical substance in terms of office rent
Based on the new legislation act, this requirement will not be a subject to change either. Our advice is to rent a small premise to show the regulator real physical presence on the territory of Lithuania where the local AML officer could potentially work (upon your choice). It will also arise probability of success in the process of a corporate account opening.
Republic of Lithuania law
Prevention of money laundering and terrorist financing
19 June 1997 – No VIII-275 – Vilnius (as last amended on 15 April 2021 – No XIV-249).Access the official document!
Our company licensing services
— What we do and do not do
Our company is EXCLUSIVELY engaged in assisting worldwide clients, either individuals or corporate entities, to get duly and properly licensed with local Regulators and Financial Authorities to get respective official licenses to legally carry out their cryptocurrency or financial related business activities.
TBA & Associates Tax Business Advisors does not provide or carry out any sort of Cryptocurrency or Financial services!
Disclaimer: While TBA & Associates strives to make the information on this website as timely and accurate as possible, the information itself is for reference purposes only. You should not substitute the information provided in this article for competent legal advice. Feel free to contact TBA Customer Services for advice on your specific cases.