Crypto License in Portugal

In April Bison Bank was authorized to offer cryptocurrency storage and trading services in Portugal. Bison Bank, a Portuguese financial institution, obtained a license from the central bank of Portugal (Banco de Portugal) to operate as a virtual asset service provider (VASP), announced on Thursday Banco de Portugal.

According to Portuguese media outlet Sapo, Bison Bank will create a special business unit Bison Digital Assets to exchange virtual assets.The division is the first legal entity in Portugal owned by a bank authorized by Banco de Portugal to offer depository and cryptocurrency trading services.
Due to the rapid development of the Fintech industry, blockchain technology in general and cryptocurrency in particular are the subject of discussion by the Portuguese government.

Over the past few years, these technologies have attracted public attention mainly because of the rising cost of Bitcoins, the increased interest in holding ICOs in Portugal and other countries, and their market capitalization.

Those who intend to create a cryptocurrency in Portugal or a cryptographic company to carry out transactions with cryptographic assets should be required to register with Banco de Portugal before starting their operations.

Obtaining authorization for cryptographic activities in Portugal is required for virtual asset providers such as:

• Exchange service providers between virtual assets and fiat currencies.
• Exchange service providers between one or more forms of virtual assets.
• Service providers that allow the transfer of virtual assets from one address or wallet to another.
• Custom wallet service providers (cryptographic exchanges and similar cryptographic companies).

Cost of cryptocurrency license

Ready-made companies with acquired crypto license in Portugal	More information

GENERAL PROVISIONS

In order to obtain a crypto-sharing license in Portugal, a number of requirements must be fulfilled, which include the following:

• Request from IBCM for prior authorization to license a company in the Portuguese Free Economic Zone;
• The registration procedure of a Portuguese company;
• Obtaining an MBCM license;
• Application for a license to exchange cryptocurrencies with the Bank of Portugal;
• Appointment of an anti-money laundering officer and a local director;
• Opening a settlement account with a Portuguese bank;

In Portugal, there are no border restrictions or obligations for declaring assets in cryptocurrency. There is no separate obligation to report, in the case of payments in cryptocurrency above a certain threshold, except for transactions in which an obligated person subject to the Portuguese AML Act may participate, In such a case, the person concerned would be required to report suspicious transactions or activities regardless of the amount involved.

Financial institutions are required to assess transfers from and to virtual platforms for trading assets in the light of ML/TF prevention rules. They require financial institutions to fulfil a number of responsibilities, including, for example:

• Identification and knowledge of their clients;
• Storing of documents concerning customers and transactions;
• Examining and reporting suspicious transactions;
• Adoption and implementation of internal controls that take into account the EA/TF risks specific to each organization.

Advantages

REQUIREMENTS

• Certified/legalized copies of passports of all participants;
• Apostille/Legalized power of attorney for the registration of the company from all participants;
• certified/legalized certificate of legality at the place of citizenship of all participants;
• The power of attorney of the Company’s directors to hire employees and apply for a license;
• Summary from all participants of the enterprise;
• Physical presence in Portugal (office);
• Local authorities (at least one of the directors must be resident in Portugal);
• Local anti-money laundering officer.

COMPANY REGISTRATION

In addition to documents for registration, 3 company names must be provided – in Portugal, repeated company names are prohibited, several names are required to select a possible option.

To register a company, it is also necessary to determine the types of economic activities that the company plans to carry out.

It is also necessary to determine the size of the minimum authorized capital. Despite the fact that the law established a limit – 1 euro.

The procedure for establishing creating a crypto company:

1. Identification of future activities and developing a business plan.
2. Selection, verification, and reservation of a commercial name for a crypto company.
3. Collection of information about the beneficiaries, founders, and managers of the company.
4. Finding a registration address for a crypto company.
5. Preparation of constituent and registration documents.
6. Formation and submission of a package of necessary documents for registration.
7. State registration, if approved.
8. Registration for tax and employment purposes.
9. Obtaining additional licenses for regulated activities.

After the registration of the company, in addition to previously collected documents, the opening of an account with the Portuguese bank requires separately:

• Agreement on the establishment of the company;
• Extract from the State Register of Companies;
• Extract from the register of beneficiaries;
• Names of parents of the account manager;
• Mobile phone number;
• E-mail address.

Crypto regulation in Portugal overview

RESPONSIBILITIES

Companies that carry out crypto operations, among other things, carry out the following actions:

• Identify clients, as well as their representatives, in the cases provided by law, request at least an identity card (for a natural person) or registration documents (for a legal person);
• Take all reasonable steps to understand the ownership structure and control of the customer;
• To be informed of the purpose and intended nature of the business relationship;
• Formation of risk profile of the client depending on peculiarities of transactions, source and destination of funds within the framework of business relationship or a one-time transaction;
• Collect, store and update information about customers and transactions with cryptographic assets;
• Apply simplified or strict control procedures under certain conditions;
• Refuse to carry out the transaction if there is a risk of money laundering and financing of terrorism;
• Submit general reports, as well as cases related to the laundering of money derived from crime and the financing of terrorism;
• Training of personnel responsible for compliance with the rules on combating money-laundering and the financing of terrorism.

MAIN RISKS

According to the Bank of Portugal, there are several types of risks connected to the cryptolicense business in Portugal.

Transactions in virtual assets have associated risks for their users as well as for all market participants. In line with the warnings by the European supervisory authorities and the National Council of Financial Supervisors, the Banco de Portugal draws your attention to the following risks:

• Virtual assets are not legal tender in Portugal, meaning that they need not be accepted at nominal value;
• Unlike regulated payment instruments, there is no legal protection that guarantees buyback rights for consumers who use virtual assets to make payments;
• In the event of total or partial impairment of virtual assets, there is no fund to cover any losses incurred by their users, who will have to assume all the risks associated with transactions using these tools;
• Users of virtual assets may lose their money on the trading platform;
• Transactions with virtual assets can be used illegally, in criminal activities, including for ML/TF.

MORE GENERAL INFORMATION

Cryptocurrency in Portugal is used to pay for services or goods that sellers accept this type of payment. This is especially advantageous for real estate sellers in Portugal.

Portugal is also attractive for obtaining a residence permit for foreigners, as this requires an investment in real estate of about 500 thousand euros.

By abandoning the income tax that was levied on individuals receiving income from the sale of cryptocurrency, the country’s leadership created more favorable conditions for the development of this business. Thus crypto traders can conduct financial activities without paying fiscal fees.

During the sale of goods or services, Portuguese tax law provides for a VAT rate of up to 23 per cent in some cases. However, the authorities have exempted crypto payments from the need to pay value added tax.

It is common practice in Portugal to pay for property in cryptocurrency. Thus, the first sale of real estate in Portugal for Bitcoin was made in 2018. The property that was sold during the transaction is located near Lisbon. This case was the first and gave a start for other real estate sellers, so today such transactions are drawn up regularly, and as payment cryptocurrency is used.

More about taxation of crypto business in Portugal.

Also, lawyers from Regulated United Europe provide legal services for obtaining a Czech Republic crypto license.

Navigating Crypto Compliance: Securing a Crypto Exchange License in Portugal 2024

Portugal, with its favorable regulatory climate and strategic position within the European Union, is becoming an attractive destination for cryptocurrency businesses. This article provides an in-depth guide on obtaining a crypto exchange license in Portugal, highlighting the regulatory landscape, application process, and the benefits of establishing a licensed operation in this vibrant market.

Regulatory Environment for Crypto Exchanges in Portugal

Portugal’s approach to cryptocurrency regulation is overseen by the Banco de Portugal and complies with broader EU financial regulations. The country offers a balanced regulatory environment that supports innovation while ensuring financial safety and compliance with international standards.

Types of Crypto Licenses in Portugal

Portugal offers a variety of crypto-related licenses to cater to different aspects of the cryptocurrency business:

• Crypto exchange license in Portugal: Permits the exchange of cryptocurrencies for fiat currencies or other digital assets.
• Crypto broker license in Portugal: Allows companies to facilitate crypto transactions on behalf of clients.
• Crypto trading license in Portugal: For entities directly engaged in buying and selling digital assets.
• VASP crypto license in Portugal: Aimed at providers of services related to virtual assets.

Requirements for Obtaining a Crypto License in Portugal

Applicants must meet stringent requirements that include robust anti-money laundering (AML) protocols, operational security measures, and financial solvency proofs. Detailed business plans and compliance strategies are essential components of the application.

Costs Involved in Obtaining a Crypto License

The crypto exchange license in Portugal cost varies depending on the type of license and the scale of operations. Although not necessarily the cheapest crypto license in Portugal, the investment is justified by the market opportunities and regulatory support offered.

Benefits of Acquiring a Crypto License in Portugal

Obtaining a license provides businesses with credibility, legal security, and access to a growing market within Portugal and across the EU. It enhances the business’s ability to attract partnerships and investment on an international scale.

Investment Opportunities in the Portuguese Crypto Market

The Portuguese crypto market is burgeoning with opportunities, highlighted by competitive licensing options and a supportive ecosystem for technology startups. The potential for growth in this sector is significant, especially for businesses that capitalize on the cheapest crypto license in Portugal.

Acquiring an Existing License

For quicker market entry, businesses may consider purchasing an existing crypto exchange license in Portugal for sale. This route demands careful due diligence to ensure compliance with all regulatory requirements and alignment with business goals.

Conclusion: As Portugal continues to solidify its position as a favorable locale for crypto businesses, securing a crypto exchange license in Portugal represents a significant strategic move for companies looking to capitalize on the extensive opportunities in the European and global cryptocurrency markets. Compliance, preparation, and a deep understanding of the regulatory environment are crucial to navigating this dynamic field successfully.