Crypto activities in Lithuania (How-To)

[Gediminas]

Hey guys,


Lithuania allows legal entities which are incorporated in Lithuania to engage in cryptocurrency exchange and/or cryptocurrency wallet/brokerage operator activities. There are 2 types of cryptocurrency activity authorization (company can provide both cryptocurrency services or one of the following):

– Cryptocurrency exchange operator is the company exchanging cryptocurrency owned by the client for the commission fee;

– Cryptocurrency depository wallet operator is the company managing client cryptocurrency depository wallets. Or in other words, custody services.


Supervisory authority does not issue any license to engage in these activities. It is just required to submit a notification with all required documentation to the respective authorities regarding such a company’s business in order to be authorized to provide such services. This means that there is no assessment of the business plan, shareholders, no license fees, etc. Companies engaged in cryptocurrency exchange and/or cryptocurrency wallet/brokerage operator activities are only supervised by Financial Crime Investigation Service (FCIS).

FCIS as supervisory authority supervises the company’s activity and its compliance to AML/KYC requirements. Requirements are applicable not only in the onboarding process (identifying client, collecting information and supporting documents about client’s UBO, CEO, management structure, etc.) but also shall be performed during the client’s ongoing monitoring (revision of documents collected during onboarding process, suspension of a suspicious monetary operation or transaction, notification regarding transactions exceeding 15 000 EUR, employee training, etc.). Legal acts require that the Company must appoint a senior staff member (AML officer) to organize the implementation of measures, to prevent money laundering and terrorist financing, and be appointed as a contact person to communicate with FCIS. It is not mandatory that the appointed person would be Lithuanian. However, as the Company needs to be in compliance with AML/KYC requirements, communicate with FCIS, and report suspicious transactions, it would be advisable to have a local AML officer.


In order to provide crypto-related services following steps shall be taken:

I. Company in Lithuania has to be incorporated.

Requirements for the Company:

- Minimum authorized capital of the company 2,500 EUR;

- Company shall open a deposit bank account in a Lithuanian credit institution in which monetary contributions for capital shall be transferred;

- Company shall have a director and AML officer (doesn’t have to be Lithuanians);

- No mandatory office space is required. The company might have a virtual address only.

II. Notify FCIS and Center of Register.

Actions that shall be taken prior to notifying authorities:

- AML officer shall be employed and State Social Insurance Fund informed regarding his/her employment.

- Gather evidencing documents that the director and UBO of the company meet the requirements of impeccable reputation.

- Prepare and approve respective AML/KYC procedures of the Company.

- Prepare notification, forms, and auxiliary documents for submission to FCIS and Centre of Register.


These actions shall not be considered as barely significant. By notifying institutions company confirms that it has taken all actions required and is in compliance with all applicable legal acts.

Once the company will notify the register regarding engagement of crypto activities, the company’s official commercial register will indicate the company’s engagement in these activities.


Are you thinking about building a crypto business? We can help with the legal part!

 

[uplana]

Not bad, do you have some estimated costs to setup such an entity legally ?

 

[Jandzo]

Gediminas, how does banking look for this kind of entity?
Will the LT EMI`s servicing crypto exchanges touch this entity? Or need to look elsewhere?

It can be of interest

 

[Gediminas]

Not bad, do you have some estimated costs to setup such an entity legally ?

The setup (including banking, etc) would not exceed 10k EUR.

 

[Gediminas]

Gediminas, how does banking look for this kind of entity?
Will the LT EMI`s servicing crypto exchanges touch this entity?

Yes, it will be fine. There are many crypto exchanges (including UAB Binance) that are registered this way.

 

[lavel]

Not the best to take Binance as an example

 

[Jandzo]

Yes, it will be fine. There are many crypto exchanges (including UAB Binance) that are registered this way.

I did not find that Binance UAB was registered for the crypto activities in the LT commercial register. Am I missing something here?
As it should be showed there, right?

 

[Jandzo]

Gediminas,
If the LT entity is set up, how long the process will take to obtain the authorization?

 

[Jandzo]

Yeh, you are right. I just took the first crypto exchange example that is registered in Lithuania as well. Turns out they don't have any records for that. But there are other exchanges with such records.

Gediminas,
If the LT entity is set up, how long the process will take to obtain the authorization?

 

[Gediminas]

Gediminas,
If the LT entity is set up, how long the process will take to obtain the authorization?

Around 2-3 weeks.

 

[KevinMcDonald]

Very interested topic! How can I contact you? Thank you

 

[spacely]

sounds really good considering that the EMIs are willing to open an accounts for such companies.

Can you please provide the link where we can check how the confirmation about this registration looks online? Or where we can check the companies with such authorizations? Will the have some kind of paper as a proof of this registration?

 

[JosephLL]

as the Company needs to be in compliance with AML/KYC requirements,

And how do these actually look like in practice? Is there some specific rules or just guidance? Is "suspicious tx" something left at discretion of aml officer to report?

 

[Gediminas]

sounds really good considering that the EMIs are willing to open an accounts for such companies.

Can you please provide the link where we can check how the confirmation about this registration looks online? Or where we can check the companies with such authorizations? Will the have some kind of paper as a proof of this registration?

There is no public source that would indicate a full list of crypto authorized companies or governmental websites that would provide info related to this registration in English. Lithuania does issue licenses as Estonia for example, the companies just simply notify governmental authorities that are engaged in crypto-related activities.

Although once the company has notified authorities in crypto activities and is acting in accordance with the requirements applicable by the laws, crypto activity is completely legal. Once notified, the official company’s extract indicates that the company is engaged in crypto activities. This extract can be apostilled/legalized and it can be presented to anyone who needs proof of this authorization.

As there are no strict licensing requirements and procedures, it is definitely a plus to run a crypto business from Lithuania. Some major players have their crypto exchanges authorized in Lithuania as Binance acting in Lithuania under Binance UAB.

 

[Gediminas]

And how do these actually look like in practice? Is there some specific rules or just guidance? Is "suspicious tx" something left at discretion of aml officer to report?

Crypto exchange has to comply with anti-money laundering (AML) laws. Not so extensive as financial institutions, but there are similarities. Crypto exchange has to appoint an AML officer which has to notify authorities about suspicious transactions. It's mandatory.

 

[spacely]

thanks @Gediminas you have been very helpful. I might have some clients for you.

How does the appointment of the AML officer look like? Does he need to be an employee or director like in Estonia? Or you simply put some name and the CV in the register?

Also, will you be able to assist with the bank or EMI account for such companies? Interested in both b2b and b2c solutions. And if yes with what institutions you are going to work with if it is not a secret of course?

And still, can you provide the link where the printouts about crypto authorization are displayed, please?

 

[Gediminas]

How does the appointment of the AML officer look like? Does he need to be an employee or director like in Estonia? Or you simply put some name and the CV in the register?

One person can be assigned as both AML officer and director of the company. This person shall be employed and pay social contributions to the state budget. There are no strict salary requirements for this person, although the salary shall be higher than the minimum salary in Lithuania. Currently, it's EUR 642 (gross).

Also, will you be able to assist with the bank or EMI account for such companies? Interested in both b2b and b2c solutions. And if yes with what institutions you are going to work with if it is not a secret of course?

Yes, happy to help with EMI account for such businesses. B2B and C2B. Most likely we would go with Bankera or Intergiro. Out of those two, I would recommend choosing Bankera. There are more options.

And still, can you provide the link where the printouts about crypto authorization are displayed, please?

There is no official Governmental website that would publish all information about the crypto authorization process, etc.

 

[spacely]

thanks for the info!

There is no official Governmental website that would publish all information about the crypto authorization process, etc.

You mentioned previously that after notification about the crypto activity the company will be able to provide the notarized and apostilled extract from some register. And this information is not public? Where this document will be taken from?

 

[Gediminas]

thanks for the info!


You mentioned previously that after notification about the crypto activity the company will be able to provide the notarized and apostilled extract from some register. And this information is not public? Where this document will be taken from?

The above is available on the official website of the State Enterprise Centre of Registers (Governmental authorities, i.e. Company’s house). Information is available on the official extract of the company which specifies the economic activities of the company.

 

[kickass007]

Crypto exchange has to comply with anti-money laundering (AML) laws. Not so extensive as financial institutions, but there are similarities. Crypto exchange has to appoint an AML officer which has to notify authorities about suspicious transactions. It's mandatory.

i need to get a company setup in lithunia get a crypto license too i am a non resident my nationality is pakistan

what costs am i looking at