* The european cryptocurrency license is issued by the Financial Intelligence Department (FIU) of Estonia, which is an independent unit of the Estonian Police and Border Guard Department. The period of consideration of the application is 60 days with a possible extension to 120 days for the decision on issuing a license.
Cryptocurrency license in Europe
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Digital currency exchanges
Cryptocurrency exchanges or digital currency exchanges are companies that allow customers to exchange cryptocurrency (fiat money for cryptocurrency and cryptocurrency fiat), as well as provide a virtual wallet service for cryptocurrency storage.
Regulation
Estonia is a leader in the regulation of cryptocurrencies and the development of crypto business. Estonian law recognizes virtual currencies as a tool containing value that can be transferred electronically, stored, redeemed and sold.
Legislation
According to current legislation, companies engaged in the storage of cryptocurrencies, crypto assets, tokens and other virtual currencies owned by third parties, Must comply with measures to combat money laundering and the financing of terrorism and obtain a license from a virtual currency provider.
The license will allow you to engage in any of the following activities:
Token issue
Exchange service
Virtual wallet services
Selling Bitcoins with Credit / Debit Card and Bank Transfers
Trading Service Tokens (utility tokens)
Primary Exchange Placement (IEO)
Over the counter transactions (OTC)
Crypto-crypto, fiat-crypto, crypto-fiat transaction
Mandatory requirements for obtaining a cryptocurrency license in Estonia
Share capital of EUR 12,000, the entire amount must be paid in cash equivalent;
Opening an account with a bank or payment institution to deposit the authorised capital;
Physical office in Estonia, local management team and officer compliance;
Appointment of at least one Resident Director;
Appointment of a local AML/Compliance officer responsible for the development and implementation of AML policies and procedures in the company. The identity of the compliance specialist is agreed with the regulatory body, the candidate must be interviewed to confirm that he is properly qualified for the job. The name, personal identification code, place of birth, nationality, residence address, position and contact details of the compliance officer must be provided to the Financial Intelligence Department (FIU);
Summary of all persons involved;
No criminal record for all participants regardless of nationality;
Business plan of the company with the description of the planned activity and financial strategy.
Deposit of a license fee of 3,300 euros.
Taxation crypto system
Under Estonian law, cryptocurrencies are considered «assets», not currency, and are taxed accordingly. However, there is no VAT.
There is no classic corporate income tax in Estonia and only distributed profits are taxed. This means that if a company’s profits are not distributed, it should not have to pay corporate income tax on its profits. In other words, all profits reinvested in business are not taxed.
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