Republic of Ireland
Cryptocurrency Licensing in Ireland
Virtual Asset Service Provider

Ireland VASP Registration

Establishing a virtual asset service provider in Ireland offers an ideal gateway for conducting Bitcoin-related business within the European Union. Notably, one of the pioneering bitcoin service providers, BitEx, is headquartered in Ireland. Among those contemplating establishing a crypto business in the EU, Ireland is widely recognized as one of the most favorable options.

Ireland embraces cryptocurrencies on a national scale, providing favorable conditions for obtaining a cryptocurrency license and serving as a pivotal point for crypto trading in the EU.

With a host of global financial and information technology giants, Ireland boasts a low corporate tax rate of 12.5%. The Blockchain Association of Ireland expresses optimism about the state of the world’s most popular cryptocurrency. Presently, over 430 financial services companies operate from Ireland, including twenty of the Top 25 Global Institutions.

Ireland’s distinctive ecosystem has fostered the growth of a world-class fintech sector that continues to expand annually. Recently, the country unveiled a new strategy, “Ireland for Finance,” outlining ambitious goals for the development of the International Financial Services industry, with Dublin positioned as the leading Financial Services hub.

Ireland stands out as an excellent location for Research Development & Innovation, offering funding support, including tax credits and funds facilitated by IDA Ireland.

Virtual Asset Service Providers authorized in Ireland benefit from passporting to other EEA member states, making it a compelling choice for establishing a cryptocurrency company.

Setting up Your VASP Entity in Ireland

The Central Bank of Ireland serves as the competent authority for AML/CFT registration and supervision of VASPs under the Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 to 2021. It’s crucial to note that VASP registration pertains specifically to AML/CFT purposes.

Regulation of Virtual Asset Service Providers

The European Union’s Fifth Anti-Money Laundering Directive (5AMLD) expanded AML/CFT obligations to entities offering specific services related to virtual assets. Ireland transposed 5AMLD into law through the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021, extending CJA 2010 to 2021 provisions to VASPs as of April 23, 2021.

Definition of VASP

For legislative purposes, Virtual Asset Service Providers (VASPs) are entities offering any of the following services related to virtual assets:

• Exchange between virtual assets and fiat currencies.
• Exchange between one or more forms of virtual assets.
• Transfer of virtual assets, involving conducting transactions on behalf of another person, moving a virtual asset from one address or account to another.
• Custodian wallet provider.
• Participation in, and provision of, financial services related to an issuer’s offer or sale of a virtual asset or both.

Implications for VASPs

VASPs are designated persons under the Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 to 2021 (CJA 2010 to 2021) and are obligated to adhere to Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) obligations outlined in Part 4 of the CJA 2010 to 2021.

VASPs are subject to the following requirements:

Registration with the Central Bank for AML/CFT purposes:

• All VASPs established in Ireland must register with the Central Bank for AML/CFT purposes.
• Firms not established in Ireland or not operating as a VASP before the 2021 Act came into force must register with the Central Bank before commencing virtual asset services in Ireland.
• VASPs established in Ireland before the 2021 Act came into force have a 3-month window to apply for registration with the Central Bank.
• Firms authorized by the Central Bank for other services, planning to operate as a VASP, must also register with the Central Bank.

Approval by the Central Bank requires satisfaction that:

• The firm’s AML/CFT policies effectively combat ML/TF risks associated with its business model.
• The firm’s management and beneficial owners are fit and proper.

Non-registration is a criminal offense for VASPs.

Ongoing AML/CFT obligations

• Conducting an ML/TF risk assessment of their business.
• Undertaking customer due diligence (CDD) for customers.
• Continuously monitoring customers and their transactions.
• Filing Suspicious Transaction Reports (STRs) with Financial Intelligence Unit (FIU) Ireland and the Revenue Commissioner when ML/TF is known or suspected.
• Implementing AML/CFT policies, procedures, and controls.
• Retaining appropriate records.
• Providing ongoing AML/CFT training to all staff.

Fitness and Probity

The Central Bank’s Fitness and Probity Regime applies to persons in senior positions within regulated financial service providers, including VASPs.

Compliance Officer (MLRO) Location

The Central Bank of Ireland does not mandate that a firm’s Compliance Officer (MLRO) be located in Ireland. However, a physical presence in Ireland and at least one senior management employee physically located in Ireland are expected to facilitate engagement with the Central Bank, aligning with EU AML Directives and Section 25 of the CJA 2010 to 2021.

Expected Level of Expertise for the MLRO

The Firm should guarantee that the MLRO:

• Possesses sufficient and relevant knowledge and expertise in AML/CFT.
• Holds the autonomy, authority, and influence within the Firm to effectively fulfill their duties.
• Can provide effective challenge within the Firm on AML/CFT matters when required.
• Demonstrates capabilities, capacity, and experience to oversee the identification and assessment of suspicious transactions, reporting, and liaising with relevant authorities as needed.
• Stays updated on current and emerging ML/TF trends and issues in the industry and comprehends how such issues may impact the Firm.
• Has access to ample resources and information to effectively perform their duties.
• Is readily accessible to staff for AML/CFT matters.

Taxation of Cryptocurrencies in Ireland

VASP Application Process

Before applying for registration, the Applicant Firm should ensure:

• The proposed services constitute VASP services.
• The ability to comply with AML/CFT obligations under the CJA 2010 to 2021.
• Seek independent legal advice if unsure about the need for registration.

Summary of Key Stages in the Registration Process:

• Applicant submits a VASP Pre-Registration Form to the Central Bank.
• Central Bank issues an email with an Institution Number and details on accessing the VASP AML/CFT Registration Form.
• Applicant submits the form and supporting documents through the ONR system.
• Central Bank acknowledges receipt and assesses the submission.
• Central Bank notifies the Applicant Firm of the assessment and any need for further information.
• Assessment conducted, and further information may be requested.
• Applicant responds to requests for information or clarification.
• Central Bank assesses the additional information and notifies the applicant of its decision.

Required Documents and Information for Application:

• VASP’s AML and CFT policies and procedures.
• VASP’s money laundering and terror financing risk assessment.
• Details of ownership and management in the VASP.
• Individual questionnaires for fitness and probity assessment.
• Business plan outlining proposed activities, projections, and outsourcing arrangements.
• Organizational structure, reporting lines, and staffing arrangements.
• AML and CFT training plan.

Ensure a swift and successful crypto registration with all necessary documents.

VASP Application
“Two-Step Process”

Step 1

• Preparation of the application, liaison with the regulator, and provision of business services.
• Completion of the application form.
• Correspondence with the Development authority throughout the application phase.
• Assistance in the development of AML and CFT documents.
• Support in the opening of safeguarding accounts.
• Company formation and provision of staffing services.

Step 2

• Compilation of legal, financial, and IT documents.
• Legal documents, including AML, KYC, and IT/Security policies.
• Financial documentation, encompassing a 3-year financial forecast, P&L statement, and fund flow.
• Operational documentation, such as internal policies, risk operation policies, and internal audit procedures.
• IT documentation.

Estimated Time for VASP License

We strive to submit your application within six weeks. Approval by the Central Bank of Ireland may take up to approximately six months. However, if additional requests for information or documentation are issued, the process may extend further.

How TBA Can Assist You

We offer comprehensive support throughout the entire registration process with the Central Bank of Ireland. For those seeking a Crypto Asset Services Provider (VASP) license in Ireland, TBA provides legal, technical, and business expertise, along with consulting support.

Our dedicated financial services development team collaborates closely with clients subject to AML/CFT requirements across various sectors. We possess extensive experience in addressing AML/CFT issues, ranging from establishing frameworks to preparing policies and procedures, providing annual training, advising on suspicious transaction report filings, offering guidance on governance and outsourcing arrangements related to AML/CFT, and guiding clients through inspections and supervisory/enforcement engagement.

For more information on registering your Crypto Assets (VASP) Company in Ireland, we encourage you to contact one of our financial services development team members.