Lithuania
Crypto Exchange & Wallet License

Lithuania stands out as a leading global jurisdiction for initiating cryptocurrency ventures. TBA & Associates offers professional assistance in securing a Lithuanian crypto license remotely, ensuring a comprehensive turnkey solution within four weeks, and providing a readily available option.

To apply for a crypto license in Lithuania, a limited liability company (UAB) is required to offer cryptocurrency exchange or storage services. Recent legislation, effective since November 1, 2022, mandates entrepreneurs starting a crypto business in Lithuania to contribute a share capital of 125,000 euros, a significant increase from the previous minimum of 2,500 euros. The new law also entails the establishment of a dedicated Lithuania crypto license register, listing crypto companies, and necessitates the appointment of an exclusive AML officer. The UAB (LLC) legal form allows for activities as a custody wallet operator and provides cryptocurrency exchange services.

It’s noteworthy that the latest Lithuanian legislation permits the registration of a crypto company without an authorized capital contribution, regardless of the amount, at any time. This sets Lithuania apart from most other European jurisdictions, demonstrating a rapid, cost-effective approach with a clear vision, and incorporating principles from the MiCa Directive.

Virtual asset service providers (VASPs) in Lithuania are subject to the oversight of the Lithuanian Financial Crime Investigation Service (FCIS).

Lithuania VASP Range of Activities

Exchange Crypto to Crypto:
VASP companies are authorized to provide exchange services between different virtual assets, including utility tokens and coins. However, trading security tokens requires an additional investment firm license.

Exchange Crypto to Fiat and Fiat to Crypto:
A Lithuanian cryptocurrency license permits the exchange of cryptocurrency for fiat currency and vice versa. This means customers can buy or sell utility tokens for currencies such as the US Dollar, Euro, British Pound, etc.

Storage Crypto on Behalf of Users:
The Lithuanian VASP license allows operators to store crypto assets on behalf of customers using custodian wallets. Operators can create wallets for customers, holding private keys securely.

Fiat Storage and Exchange:
VASPs may accept fiat currency as prepayment for services, typically to exchange it for cryptocurrency. While custody of fiat funds is not permitted under the VASP license in Lithuania, operators can retain the prepayment for an indefinite period as a counter obligation, eventually exchanging it for crypto.

In summary, Lithuania’s crypto licensing framework encompasses a range of activities, providing clarity and flexibility for businesses in the rapidly evolving cryptocurrency industry.

Lithuania
A Crypto-Friendly and Attractive Jurisdiction

Lithuania is emerging as one of the most crypto-friendly and appealing jurisdictions within the European Union. It provides a regulated legal environment for Virtual Asset Service Provider (VASP) companies, complete with clear and well-defined regulations.

In comparison to neighboring Estonia, Lithuanian regulations offer greater flexibility in terms of setup and come with lower ongoing costs, as there is no specific requirement for onsite personnel. Our seasoned professionals, with extensive experience in both Estonia and Lithuania, are available to assist you remotely, eliminating the need for travel.

Professional Solutions for Crypto Exchange and Wallet Licenses
Lithuanian Advantages

Simplicity:
Minimal procedural requirements and reduced bureaucratic burden, resulting in straightforward company registration without the need for extensive supporting documents.

Low Costs:
Limited financial obligations, covering company registration, authorized capital, and document preparation and submission.

Local Resident Members:
No mandates for the residence of the company director and shareholders.

Company Director (CEO) Citizenship:
Non-compulsory requirement for the company’s director (CEO) to possess Lithuanian citizenship.

Taxes:
Corporate tax at 15%, one of the lowest rates in the EU.

Hiring Local Staff:
No prerequisites for hiring local staff.

Interview with Lithuanian Authorities:
KYC/AML officers and other employees do not need to undergo interviews with Lithuanian authorities; the responsibility lies with the company’s CEO to ensure qualifications and experience.

Terms:
Registration can be completed in as little as 3 weeks.

Remote Registration Format:
Remote registration of a Lithuanian company is a viable option.

Lithuania Crypto License
Cryptocurrency Company Structure

Entities operating within the cryptocurrency sector must adhere to various requirements, including:

• Establishment of a limited liability company (UAB) in Lithuania, responsible for providing cryptocurrency exchange and/or storage services.
• Minimum authorized capital requirement, set at €125,000 from November 2022; however, the new Lithuanian legislation permits the registration of a crypto company without an authorized capital contribution, regardless of the amount.
• The cryptocurrency company can be established either in person or remotely through proxy without the need to visit Lithuania.
• Presence of at least one owner (natural or legal person) and one board member, who may also be the owner.
• Money Laundering Reporting Officer (MLRO) requirement, effective from November 2022, necessitating a local resident position with an employment contract, with one position per Lithuanian Crypto company, meeting professional experience and fit-and-proper requirements.
• Selection of premises for rent based on client preferences, considering factors such as size, cost, location, and infrastructure.
• Disclosure of beneficial owners’ details to the authorities.
• Conducting background checks and identification procedures for all clients.
• Maintenance of customer data for eventual submission to the regulator.
• Implementation of internal control and risk assessment procedures.
• Reporting to the Financial Crimes Investigation Service (FCIS), the regulator.

Currently, a UAB is one of the most commonly used and popular business entity types in Lithuania.

General Provisions

Throughout the licensing process, the FCIS reserves the right to request additional information and a detailed description of the proposed activities of the cryptocurrency company. The issuance of a crypto license typically occurs only after all required information is deemed sufficient and all stipulated requirements have been met. Any subsequent changes to the cryptocurrency company structure, post-license issuance, such as changes in address, ownership, board members, beneficiaries, AML officers, etc., necessitate corresponding filings with 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%, with a micro company (less than ten employees and less than €300,000 gross annual income) potentially subject to a reduced corporate tax rate of 0-5%.
• Income tax (WHT) of 15% is imposed on distributed profits (dividends paid).

Lithuania
Cryptocurrency License Application
Documents Required for Application Purposes

• Valid copies of passports of company officers.
• Power of attorney (if opting for remote application).
• Detailed activity description of the company.
• Curriculum Vitae showcasing business experience and professional expertise of all officers directly involved in 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 mandatory, and this officer must demonstrate professional experience and an excellent reputation (Lithuanian residence is not compulsory).
• Consent of all directors.
• Confirmation of opening a bank account in Lithuania.
• Additional information may be requested by government agencies during registration.

Republic of Lithuania 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!

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).