Get the Cheapest Crypto License in Europe and Minimise Crypto Licence Costs

If you are looking for a more affordable European cryptocurrency license, consider jurisdictions where a fully-fledged crypto regulations framework is yet to be implemented. Naturally, such countries avoid imposing high licence application and supervision fees, which enables crypto entrepreneurs to invest their resources in the development of their businesses. Besides, the lack of stringent regulations also implies easily meetable eligibility criteria for a crypto authorization.

Does that sound like a good route for your crypto company? Read on for an overview of the European jurisdictions our team highly recommends, based on a handful of basic criteria, which you should pay attention to in order to place your crypto company within the most suitable set of laws.

The Fastest Crypto License to Get in Europe Today

With the dynamically developing market of cryptocurrencies, significant demand is created for entrepreneurs who want to start a business as fast as possible and requires deep blockchain knowledge along with the ability to get through the regulatory environment. Thus, the most interesting jurisdictions for the acquisition of the relevant licence as quickly as possible include the Czech Republic with a fairly relaxed approach to the regulation of cryptocurrencies. In this article, we will go through the procedure for obtaining a license in cryptocurrency in the Czech Republic with an overview of the key steps, founder requirements, and timeline to establish a company.

Why choose the Czech Republic to obtain a license?

Such a combination – nice and friendly regulatory environment and fast-track licensing procedure related to cryptocurrency business – can hardly be found anywhere else but in the Czech Republic. The transparency of its legislative framework, along with friendliness to fintech innovations, attracts entrepreneurs from all over the world to this country.

Stages of obtaining a licence

Founder requirements

• Reputation: Good business reputation, no criminal record
• Financial strength: Evidence for sufficient capital to start and keep the operation running
• Professional experience: Experience in finance, preferably connected with cryptocurrencies and blockchain

Timing

On a comparative basis, the procedure for getting a license for virtual currency in the Czech Republic is speedy, taking up to several months because of how complete and exact the given documentation is.

The Czech Republic now boasts one of the most efficient and affordable environments in Europe in which to establish a cryptocurrency business due to its favorable regulatory climate and speedy licensing process. In case of compliance with all requirements and following procedures carefully, the licensing process can be accelerated as much as possible, which finally means the successful growth of your business in the dynamically changing world of cryptocurrencies.

Does a company necessarily have to have a local director in the Czech Republic?

The paper will cover the need for a resident director if a company is incorporated in the Czech Republic, which has been one of the most puzzling questions for many foreign investors and entrepreneurs looking to start businesses in the country. The Czech law has distinct requirements regarding the firm’s governance structures, including composition.

In this article, we review whether the need for a local director for companies in the Czech Republic is required and what the specifics and requirements regarding company management are.

Requirements for company directors in Czech Republic

Under Czech law, there is, in principle, no law requiring any company’s statutory director/managing director or member of the management board necessarily to be a resident of the country, but some aspects have to be taken into consideration upon the appointment of a foreigner to the management of the company.

Key aspects to consider:

• Ability to perform duties: The foreign director shall be able to visit the Czech Republic from time to time for performing his functions, attending meetings, and communicating with the competent state authorities of the Czech Republic.
• Communication: No requirement for the Czech language, although it may be necessary for proper company management as well as for all interactions with the local authorities and partners.
• Registration – Since the foreigner is acting as a director, he is supposed to file the necessary documentations, like identification proof and, if pertaining to interstate, his criminal record certificate for registration at KRS.
• Taxation aspects: A foreign national, upon appointment as a director, results in consequences related to tax liability, both for the appointed director and the company with regard to income tax liability and social security.

Benefits of appointing a local director

While not required, there are considerable benefits associated with having a local director, including:

• Improvement of local market and legislation knowledge.
• It strengthens liaison with government departments and business associates.

The best representative of the company’s interests in the Czech Republic. Possible alternatives The companies that are planning to keep the management flexible might consider the option of a foreign director who would grant a PoA to a local representative or use professional corporate director services in the Czech Republic. While there is no necessity under Czech law for a local director, being an ingredient of the company, his appointment can bring many operational and strategic advantages. It is upon foreign investors to balance these pros and cons against each other, considering business goals and governance needs, before deciding which way to go regarding the governance structure of a company in the Czech Republic.

Steps to minimize costs

Timing

It usually takes several weeks, if not months, to obtain a license to conduct cryptocurrency activity in the Czech Republic, depending on how complicated the preparation of documents will be and how efficient the interaction with the regulative authorities will be.

At the same time, the Czech Republic is among the cheapest and fastest procedures for obtaining a crypto license. This will provide an opportunity for entrepreneurs to reduce the cost of such a procedure as far as possible and be certain that their business fully corresponds to all the requirements of the Czech Republic legislation. Furthermore, one needs to stress that previous analysis and involvement of the local experts are vitally important for a smooth and cost-effective licensing process.

Number of cryptocurrency users in European Union countries (over 200,000 users)

How to Choose a Crypto License

Whereas the opportunity to get an affordable license may turn out to be a game-changer for a young or ever-maturing crypto company, this does not mean that the rest of the aspects are irrelevant in this context. It therefore means serious, profound study of the legislation of your future jurisdiction for the purpose of assessing how your crypto-economic activity can be qualified within the general legislative framework, including what corporate reporting and taxes may apply.

This will save your company from unnecessary hurdles and will facilitate an informed business strategy. If you can plan a consultation with us in the nearest future, our experts here at Regulated United Europe (RUE) will be able to assist you in evaluating each legal particularity and advise based on your experience.

Meanwhile, get yourself introduced to three European countries that can provide respectable yet quite liberal jurisdictions within the EU for crypto entrepreneurs: the Czech Republic, Poland, and Lithuania. They differ in many aspects, including requirements for authorized capital, procedures of crypto registration, and tax environments; generally speaking, though, it has become comparatively easy now to run an authorized crypto company in one of the aforementioned countries.

Crypto License in the Czech Republic and Poland

In case licence fees become for you a main selection criterion of a cryptocurrency licence for your crypto company, pay your attention to the Czech Republic and Poland – two EU countries which issue the cheapest crypto licenses in Europe while still allowing their licensees to enjoy all the benefits of being the part of the EU market. Competitive fees are explained by the lack of a proper strong regulatory framework, which also explains why current prerequisites of the registration, as well as the relevant procedures, are minimal and can be easily put in place.

Main advantages of a crypto license in the Czech or Poland:

• There is no requirement for hiring of local employees
• There is no requirement for opening a physical office in the country of licensing
• No significant minimum authorized capital requirements are present
• Quick licensing process

It is worth noting that both countries offer some kind of crypto license, considering that such a type of permission is more about straightforward registration and standard licensing rather than a far-reaching crypto licensing procedure. In general, to obtain such a type of crypto company legalization and give a start to your business activity, you need to simply notify the local authorities and share information on the company members. That being said, since both countries are a part of the EU, every crypto regulatory rule has to be actualized in their national legislation. Hence, before making a decision based on choosing to register, consider the Anti-Money Laundering and Counter-Terrorist Financing Directives of the EU.

Crypto License Czech Republic

Generally speaking, the financial market of the Czech Republic is regulated by The Czech National Bank (CNB), still this authority doesn’t recognize cryptocurrencies as a legal means of payment. They are instead treated as commodities under the EU legislation according to the extract “Security of Internet Payments and Cryptocurrency”, issued in 2018 by the CNB.

In the case of starting economic activities in the Czech Republic, you will probably need to go through general authorization procedures and obtain one of the ordinary trade licenses issued by the Trade Licensing Register. To apply, you will be asked to submit an electronic application with data on the company and its founders to one of the general Trade Offices in the Czech language. If you need certified translation, we will be happy to provide you with a low price herein RUE. You also must be ready to pay a state application fee of 6,000 CZK, about 243 EUR, for the completion of your registration.

This kind of license, as any other EU license, will provide access to the EU market and allow establishing a branch office elsewhere in the European Union by simple notification to the local authorities. At the same time, this is mutual-if one is already an EU-licensed institution, there is no duty to apply for a Czech trade license but one has to notify local Czech authorities about the activity within the country.

Anyway, regardless of the fact that there is no particular strong Czech regulatory framework yet present you should keep in mind observing the above-mentioned EU-imposed AML/CFT regulations as well. They’re policed by the Financial Analytics Office (FAU) which you have to be registered with for reporting purposes and which hasn’t come up, fortunately, with any complicated-to-reach registration requirements.

Consider the following Czech AML/CFT legislation:

• Where more detailed AML/CFT measures are applied, it relies on:
• The AML Act (Act No. 253/2008 Coll.)
• The AML Decree (Decree No. 281/2008 Coll.) stipulating the requirements for corporate AML/CFT policies and procedures
• The Criminal Code (Act No. 40/2009 Coll.), which defines criminal acts
• The International Sanctions Act (Act No. 69/2006 Coll.), which lays down special rules for imposing international sanctions

Although the Czech Republic has low fees for crypto licensing and has a quite liberal approach to regulating crypto companies, that by no means involves an assumption that a crypto company can function without appropriate crypto authorization. A crypto company operating without a license will be labeled fraudulent and receive a penalty of up to 500,000 CZK (approx. 20,000 EUR) in addition to being obliged to cease its activities.

Crypto License in Poland

The Polish financial market is supervised by The Polish Financial Supervision Authority (KNF) which hasn’t yet introduced any strict crypto regulatory framework. Therefore, current Polish crypto companies simply have to navigate the existing general financial and other relevant legislation. In case you need assistance related to the assessment of your crypto activities from a legal perspective, just drop a line requesting personal consultations with our team members who will be glad to share their knowledge and advice.

But before you consider Polish jurisdiction, have a closer look at several key aspects related to the crypto business regulations. Since Poland has already transposed the EU’s AML/CFT directives into its national legislation, the Polish crypto companies fall under an obligation to register and report to the General Inspector of Financial Information responsible to enforce the Polish AML/CFT laws with a purpose to mitigate and eliminate risks related to financial crime.

If you are ready to abide by these extra requirements in AML/CFT, your way to a Polish crypto license will have to include registration with The Tax Administration Chamber – an institution in charge of maintaining the Register of Virtual Currencies created for the purpose of ensuring conformity with AML/CFT regulations. It’s a legal requirement; inability or failure to do so will result in a fine of 100,000 PLN (approx. 21,000 EUR).

In order to apply to the Register of Virtual Currencies, you should have your company documents ready and pay stamp duty of 616 PLN (approx. 130 EUR). The application process itself should not take more than two weeks, and after your company appears on the register, no supervision fees should worry you anymore.

Before you decide to avail yourself of the advantages that both countries have on offer, note that the Czech Republic and Poland are currently working on the legislation that is to shape their crypto regulatory frameworks in the future, which indicates that at some point, every licensee faces much stricter requirements-just like in Estonia or other European countries where new crypto regulations have forced crypto companies to either adjust their operational structures or look for alternative jurisdictions. Of course, if you’re determined to use this time to grow your crypto company in the direction of more demanding conditions, this isn’t a threat to you. On the contrary, it can be turned into a big advantage-you could start preparing gradually for what awaits you in most modern jurisdictions.

Crypto License in Lithuania

Among many other reasons, Lithuania stands out for being one of the most attractive European jurisdictions regarding conducting cryptocurrency business and low licensing. Whereas more robust European crypto regulatory frameworks set rather steep license application and supervision fees, Lithuanian authorities don’t ask for anything like this, which is a considerable advantage.

Therefore, 2022 became the year of changes for Lithuanian crypto business: the Law of the Republic of Lithuania on the Prevention of Money Laundering and Terrorist Financing was supplemented with the amendments directed to enhance the existing crypto regulatory framework. First of all, one should know that Lithuanian crypto licensees are obliged to have minimum authorized capital of EUR 125000. Some of these changes have already come into force, while others will enter into force in 2023-2025. Maybe this is some kind of indication that the regulatory regime is modern and will not need extensive changes in the immediate future, which again might give the crypto entrepreneurs much-needed confidence in stable regulatory ground on which businesses can be developed.

In Lithuania, crypto licenses are issued by The Bank of Lithuania that also supervises the activity of authorized crypto businesses and offers some valuable initiatives for blockchain business development, respectively.

The authority issues two types of crypto licenses:

1. Crypto Wallet Custodian License: It allows crypto firms to act in the provision of crypto wallet custodial services in the interests of users.
2. Crypto Exchange License, which entitles crypto companies with rights to provide services of changing cryptocurrency for fiat money and vice versa, and also exchange services between different types of cryptocurrencies.

For the purposes of AML/CFT, Lithuanian crypto business is supervised by The Financial Crime Investigation Service by means of collecting reports and otherwise.

Good-quality supervision can make Lithuania notable for investors from the point of view of ensuring a safe business environment, being ranked 9th among jurisdictions with low risks. Probably, this feature will give more conclusive power to increase the prestige of your company internationally.

Among the undoubted benefits of the Lithuanian crypto license, there is one important fact: all licensed Lithuanian cryptocurrency companies fall into the public eye, combined within one list kept by the State Enterprise Centre of Registers. It will be available starting from 1st February 2023 and hence forward, any business partner, investor, and client, and any other party will be in a position to check the license of any given crypto company, which will further enhance transparency and build more trust in this field of business.

If any of the above jurisdictions drew your attention and you would like to learn more about either a legislative framework or how the registration is performed, or probably you are in doubt as to which one will serve your crypto business best, then do not hesitate to contact our highly qualified and insightful team for support.

We would be glad to personally support you with value-added services as to the very registration of your Crypto Company in one of those jurisdictions, including all related document preparation and filings. From the very beginning, we could support you with fast-moving specialists in AML/CFT legislation, crypto licensing, corporate reporting, and tax advice. For a personal consultation, please do not hesitate to get in touch with us.

The Best Countries in Europe for Crypto Investors

Over the last couple of years, Europe has emerged as one of the largest hubs for cryptocurrency investment. Among those, Lithuania and the Czech Republic are taken into consideration as the most friendly jurisdictions to crypto investors. Such popularity is initially rooted in their friendly policy toward cryptocurrencies, developed financial infrastructure, and favorable taxation.

Lithuania: Frontrunner in Cryptoinnovation

Generally, Lithuania has gained a reputation as a country that is particularly friendly with technology and innovation. The country offers one of the friendliest environments in Europe for cryptocurrency due to the following factors:

• One of the most friendly cryptocurrency climates in Europe is offered by the country due to:
  • Progressive regulation: Lithuanian regulators are engaged in active work on establishing transparent rules for cryptocurrency companies; that opens more functions and opportunities for its development, along with:
  • Tax incentives: There are attractive tax conditions for crypto investors within Lithuania. In most cases, for instance, profits from cryptocurrency trading are taxed in a more favorable way compared to other forms of income sourced in the country.
  • Support for startups: The country also is very supportive of startups related to cryptocurrency by providing them with funding opportunities and mentorship programs, which allow them to grow and mature over time.

Czech Republic: Stability and Innovation

Czech Republic is among the most appealing countries for crypto investors in Europe, due to:

• Stable economy: The high level of economic stability creates a very good safe investment destination.
• Crypto-friendly environment: Probably one of the most accessible places to start crypto trading due to the big number of cryptocurrency exchanges and services within this country.
• Tax advantages: Not as appealing as those of Lithuania, but it is still possible for crypto investors to enjoy some benefits under the Czech tax policy, for example not paying capital gains tax if holding the assets for a long period of time. They offer a friendly regulative environment, tax incentives, and supporting innovation-things that place them in the top tier of destinations for cryptocurrency opportunities.

While Lithuania charms with its progressive regulations and support for startups, the Czech Republic offers stability and developed infrastructure for crypto investments. Large countries like these show how a positive approach to new technologies and flexible regulation might contribute to the growth of the crypto industry.

Best Countries for Crypto Businesses

During the last ten years, cryptocurrencies and blockchain technologies turned upside down the global financial system. Such attention from entrepreneurs who closely seek the best conditions to develop their crypto business has been attracted. Among the European countries, Lithuania and the Czech Republic can be distinguished as the most favorable for this kind of company. They offer the progressive regime of regulation, a friendly ecosystem, and an attractive economic environment.

Lithuania-Platform for Innovation in Cryptospace

Lithuania has gained the attention of the worldwide crypto community due to its openness to new technologies and progressive approach in the issue of regulation of both cryptocurrencies and blockchain projects respectively. This is based on the following:

Relatively accessible regulation: The Lithuanian government has worked out quite a clear and transparent regulatory framework regarding crypto businesses. Receiving licenses is relatively easier. This facilitates the conduct of business within the country.

Tax incentives: Lithuania maintains friendly tax conditions for crypto companies like tax preferences for startups and investments in blockchain projects.

Technological support: The country is warmly welcoming crypto initiatives and invests much in technological development, thus creating an excellent environment for their creation and development.

Czech Republic: Reliable Basis for Crypto-Enterprises

The Czech Republic is also an attractive destination for crypto businesses in Europe due to its stable economic climate and friendly regulation:

Stable economic environment: The Czech Republic features a stable economy and enjoys an extremely high degree of financial security, making it a secure location for business engagements.

Friendly regulation: Despite the stringent EU regulation policy, the Czech Republic manages to harmoniously balance the need for regulations along with support for innovation and hence provides a very friendly atmosphere for crypto-enterprises.

Active crypto community: There is an active and supportive crypto community in the Czech Republic, offering many networking opportunities and resources for startups and entrepreneurs.

Lithuania and the Czech Republic have emerged as two of the most attractive places within Europe, providing the best conditions for growth and development under such dynamic changes in the industry. They offer crypto business a stable economic environment, affordable regulation, and support for innovation. Such are the ingredients that make Lithuania and the Czech Republic just the right place for those desiring to develop their crypto business in comfortable and friendly conditions.