Cryptocurrency License in Czech Republic

The Czech Republic has emerged as one of the most attractive European jurisdictions for crypto businesses seeking regulatory authorization under the EU’s Markets in Crypto-Assets (MiCA) Regulation. With a streamlined licensing process, competitive costs, and crypto-friendly regulatory environment, Czech Republic offers an optimal balance of speed, compliance, and market access for Crypto Asset Service Providers (CASPs).

Since December 30, 2024, MiCA has established a unified regulatory framework across all EU member states, replacing the previous patchwork of national regimes. For crypto businesses, this means obtaining a single CASP license in Czech Republic grants passporting rights to operate throughout the entire European Economic Area—a market of over 450 million consumers.

Our team of regulatory experts, compliance specialists, and legal advisors provides comprehensive support for obtaining Czech CASP licenses, from initial assessment through post-licensing compliance. With hundreds of successful applications across European jurisdictions since 2017, we deliver turnkey solutions that ensure regulatory approval while minimizing time and costs.

The Markets in Crypto-Assets Regulation (MiCA) is the European Union’s comprehensive regulatory framework for crypto-assets, service providers, and issuers. Officially designated as Regulation (EU) 2023/1114, MiCA entered into force on June 29, 2023, with phased implementation throughout 2024-2025.

MiCA represents a paradigm shift in European crypto regulation, replacing fragmented national approaches with harmonized EU-wide standards. The regulation establishes clear rules for crypto asset service providers (CASPs), issuers of asset-referenced tokens (ARTs), and issuers of e-money tokens (EMTs), creating legal certainty while protecting consumers and maintaining financial stability.

Key Implementation Timeline:

June 30, 2024: Stablecoin provisions (Titles III and IV) became applicable. Issuers of ARTs and EMTs must comply with authorization, reserve, and transparency requirements.

December 30, 2024: Full MiCA provisions for CASPs became applicable, including licensing requirements and the Transfer of Funds Regulation (TFR) implementing the “travel rule” for crypto transfers.

July 31, 2025: Deadline for existing Virtual Asset Service Providers (VASPs) operating under national regimes to submit CASP license applications to benefit from transitional provisions.

July 1, 2026: End of transitional period. All crypto service providers operating in the EU must hold valid MiCA CASP licenses or cease operations.

In Czech Republic, the Czech National Bank (CNB) serves as the National Competent Authority (NCA) responsible for CASP licensing and supervision. The Financial Analytical Office (FAU) maintains responsibility for anti-money laundering (AML) oversight. This dual regulatory structure ensures comprehensive supervision covering both prudential and AML/CFT aspects.

MiCA establishes a classification system for CASPs based on the nature and risk profile of services provided. The Czech National Bank determines the appropriate license class during the application assessment, considering factors including service types, transaction volumes, operational complexity, and risk exposure.

Understanding the distinction between CASP classes is essential for proper planning, as classification directly impacts minimum capital requirements, organizational obligations, and ongoing compliance costs.

Class 2 represents the standard CASP authorization suitable for most crypto businesses providing exchange, custody, and wallet services. This classification covers the majority of crypto service providers entering the Czech market.

Minimum Share Capital Requirement: €125,000 (fully paid in cash, deposited in EEA bank account)

Covered Services Include:

– Exchange of crypto-assets for fiat currency or other crypto-assets
– Operation of crypto-asset trading platforms
– Custody and administration of crypto-assets on behalf of clients
– Provision of crypto-asset wallet services (custodial and non-custodial)
– Reception and transmission of orders for crypto-assets on behalf of clients

Typical Business Models:

Class 2 authorization suits centralized exchanges, P2P trading platforms, custodial wallet providers, crypto payment processors, and crypto brokerage services with moderate transaction volumes and standard operational complexity.

The regulatory framework requires Class 2 CASPs to maintain adequate operational and organizational arrangements, including robust AML/KYC procedures, transaction monitoring systems, cybersecurity measures, and client asset segregation protocols.

Class 3 authorization applies to CASPs providing more complex services, handling significantly higher transaction volumes, or presenting elevated operational risks requiring enhanced regulatory oversight.

Minimum Share Capital Requirement: €150,000 (fully paid in cash, deposited in EEA bank account)

Enhanced Requirements:

Class 3 CASPs face stricter organizational requirements, including more comprehensive risk management frameworks, enhanced internal controls, additional reporting obligations, and potentially higher ongoing capital requirements based on operational costs and risk exposure.

When Class 3 May Be Required:

The Czech National Bank may determine Class 3 classification for businesses with high-volume operations, institutional client focus, complex product offerings, significant cross-border activities, or advanced trading functionalities (margin trading, derivatives, lending).

Important Note: The CNB retains discretion in determining appropriate classification. Even if you initially anticipate Class 2 requirements, the regulator may assign Class 3 based on comprehensive risk assessment of your business model, projected volumes, and operational complexity.

Obtaining a CASP license in Czech Republic requires satisfying comprehensive regulatory requirements spanning corporate structure, local substance, qualified personnel, capital adequacy, and extensive compliance documentation. The Czech National Bank conducts thorough assessment of all aspects to ensure applicants meet MiCA standards before granting authorization.

Our structured approach addresses each requirement systematically, ensuring complete compliance while optimizing timeline and costs. The following sections detail specific requirements across all critical areas.

Legal Entity Requirement:

CASP applicants must establish a Czech legal entity in the form of společnost s ručením omezeným (s.r.o.)—the Czech equivalent of a limited liability company. The company must be registered in the Czech Commercial Register before submitting the CASP license application.

Company registration typically requires 10-15 business days from document submission to the Commercial Register. The process involves notarization of founding documents, registration with tax authorities, and establishment of the corporate structure.

Share Capital Requirements:

Minimum share capital depends on the CASP class:

Class 2: €125,000 minimum
Class 3: €150,000 minimum

Critical capital requirements:

– Capital must be fully paid in cash (in-kind contributions not permitted)
– Funds must be deposited in a bank account within the European Economic Area
– Capital must remain available throughout the licensing process and operations
– The CNB may require higher capital based on business model complexity, projected operational costs, and risk assessment

Capital Calculation Methodology:

The regulator evaluates whether minimum capital provides adequate financial cushion based on:

– Projected operational expenses (minimum 3 months coverage)
– Business model complexity and associated risks
– Transaction volumes and client asset custody amounts
– Geographic scope and cross-border activities

Companies should prepare detailed financial projections demonstrating capital adequacy for their specific business model.

Czech Republic requires CASPs to maintain genuine local presence, ensuring effective supervision and operational accountability. Substance requirements encompass physical infrastructure, local management, and qualified compliance personnel.

Physical Office Requirement:

CASPs must maintain a physical office in Czech Republic serving as the registered seat and operational headquarters. The office must be:

– A genuine business premises (not virtual office or mailbox)
– Suitable for conducting business operations
– Accessible to regulatory authorities for inspections
– Documented through lease agreement or ownership proof

Typical office costs in Prague range from €500-€2,000 monthly depending on location and size. Smaller cities offer more economical options while maintaining regulatory compliance.

Resident Director Requirement:

At least one member of the company’s statutory body (jednatel in Czech s.r.o. structure) must be a Czech resident. The resident director must:

– Hold valid Czech residence permit or be EU/EEA citizen residing in Czech Republic
– Possess relevant professional qualifications and experience
– Pass fit-and-proper assessment by the CNB
– Be actively involved in company management (not nominee director)

Non-resident shareholders and additional directors are permitted. The ownership structure can be 100% foreign, provided local management requirements are satisfied.

Money Laundering Reporting Officer (MLRO):

CASPs must designate a qualified MLRO responsible for AML/CFT compliance. The MLRO must:

– Be Czech resident or have sufficient presence to fulfill duties effectively
– Possess relevant AML/CFT qualifications and experience
– Hold sufficient authority within the organization
– Have direct reporting line to senior management
– Be independent from operational functions to avoid conflicts of interest

The MLRO role can be fulfilled by an employee or outsourced to qualified external specialist. Many clients leverage our outsourced MLRO services, combining regulatory expertise with cost efficiency.

Additional Personnel Considerations:

While not all employees must be Czech residents, CASPs should demonstrate adequate local operational capacity. Key considerations include:

– Compliance function: Sufficient personnel to implement and monitor compliance programs
– IT security: Qualified staff or contractors for cybersecurity and system integrity
– Customer support: Adequate resources for client communication and complaint handling
– Risk management: Personnel responsible for ongoing risk assessment and mitigation

Comprehensive compliance documentation forms the cornerstone of CASP authorization. The Czech National Bank conducts detailed review of all policies and procedures to ensure robust operational framework aligned with MiCA requirements.

Mandatory Policies and Procedures:

1. AML/KYC Policy and Procedures
– Customer identification and verification procedures (CDD)
– Enhanced due diligence (EDD) for high-risk customers
– Ongoing monitoring and transaction screening
– Suspicious activity detection and reporting (SAR)
– Record-keeping requirements and data retention
– Training programs for personnel

2. Know Your Transaction (KYT) Monitoring
– Real-time transaction monitoring systems
– Risk-based transaction screening rules
– Alert investigation procedures
– Sanctions screening and PEP checks
– Reporting mechanisms for suspicious patterns

3. Client Asset Segregation Policy
– Procedures for separating client assets from company assets
– Custody arrangements and safeguarding measures
– Daily reconciliation processes
– Client disclosure of segregation arrangements
– Insolvency protection mechanisms

4. Cryptographic Key Management
– Key generation, storage, and backup procedures
– Multi-signature and access control protocols
– Hardware security module (HSM) utilization
– Key recovery and disaster scenarios
– Regular security audits

5. Outsourcing and Third-Party Risk Management
– Due diligence procedures for service providers
– Contractual requirements and SLAs
– Ongoing monitoring of outsourced functions
– Business continuity provisions
– Data protection and confidentiality

6. Conflict of Interest Policy
– Identification of potential conflicts
– Disclosure requirements
– Mitigation measures and organizational arrangements
– Personal account dealing rules for employees
– Gifts and entertainment policies

7. Marketing and Disclosure Requirements
– Fair and clear communication standards
– Risk warnings and disclaimers
– Product disclosure documents
– Advertising compliance procedures
– Social media and influencer guidelines

8. Travel Rule Compliance (TFR)
– Procedures for collecting originator/beneficiary information
– Inter-VASP communication protocols
– Data formatting and transmission standards
– Record-keeping for transfer information
– Compliance with FATF Recommendation 16

9. ICT Governance and Cybersecurity
– IT system architecture and security measures
– Access controls and authentication protocols
– Incident response and breach notification
– Business continuity and disaster recovery
– Regular penetration testing and vulnerability assessments

10. Operational Resilience and Business Continuity
– Business impact analysis
– Recovery time objectives (RTO) and recovery point objectives (RPO)
– Alternative operational arrangements
– Crisis management procedures
– Regular testing and updating

11. Complaint Handling Procedures
– Complaint reception and registration
– Investigation and resolution processes
– Escalation procedures
– Reporting to management and regulators
– Client communication and feedback

12. Data Protection and Privacy (GDPR Compliance)
– Legal basis for data processing
– Data subject rights procedures
– Data retention and deletion policies
– Cross-border data transfer mechanisms
– Data breach notification procedures

All policies must be tailored to your specific business model, risk profile, and operational arrangements. Generic templates are insufficient—regulators expect documentation demonstrating genuine understanding of your business risks and appropriate mitigation measures.

Our compliance team develops comprehensive, bespoke policy frameworks aligned with MiCA requirements and CNB expectations, ensuring regulatory approval while creating practical operational tools for your business.

All shareholders, directors, and key function holders must satisfy fit-and-proper requirements, demonstrating good repute, relevant professional qualifications, and absence of conflicts that could compromise the CASP’s integrity.

Applicable Persons:

– All shareholders holding 10% or more of shares or voting rights
– All members of the statutory body (directors/jednatelé)
– Money Laundering Reporting Officer (MLRO)
– Chief Compliance Officer (CCO)
– Chief Risk Officer (CRO)
– Chief Information Security Officer (CISO)
– Other key function holders as determined by business structure

Required Documentation for Each Person:

1. Certificate of Non-Criminal Record
– Issued by country of citizenship and country of residence (if different)
– Must be dated within 3 months of application submission
– Apostilled or legalized according to international conventions
– Translated to Czech or English by certified translator

2. Curriculum Vitae
– Detailed professional experience (minimum 10 years recommended)
– Educational background and professional qualifications
– Relevant experience in financial services, crypto, compliance, or technology
– Professional references

3. Proof of Identity and Residence
– Valid passport (notarized copy)
– Proof of residential address (utility bill, bank statement, dated within 3 months)
– For non-EU citizens: valid residence permit or visa

4. Declaration of Good Repute
– Sworn statement regarding criminal history, bankruptcy, regulatory sanctions
– Disclosure of any ongoing investigations or proceedings
– Declaration of potential conflicts of interest

5. Professional Qualifications
– University degrees (notarized copies)
– Professional certifications (ACAMS, CAMS, CFA, etc.)
– Evidence of relevant training and continuing education

Fit-and-Proper Assessment Criteria:

The CNB evaluates:

Good Repute: Absence of criminal convictions, regulatory sanctions, or involvement in business failures suggesting lack of integrity or professional competence

Professional Qualifications: Adequate knowledge, skills, and experience for the specific role, considering the nature and complexity of the CASP’s activities

Sufficient Time Commitment: Ability to dedicate adequate time to fulfill responsibilities effectively, considering other professional commitments

Independence and Conflicts: Absence of conflicts of interest that could compromise independent judgment or the CASP’s interests

Important Considerations:

– Non-EU shareholders face no restrictions—foreign ownership is fully permitted
– Previous involvement in crypto businesses (even if unsuccessful) does not automatically disqualify, but must be disclosed and explained
– Minor historical issues may be acceptable if properly disclosed and contextualized
– Attempting to conceal information is far more damaging than transparent disclosure

We assist with comprehensive preparation of fit-and-proper documentation, including obtaining certificates from foreign jurisdictions, professional translations, and strategic presentation of candidate qualifications to maximize approval likelihood.

The Czech CASP licensing process follows a structured timeline spanning 6-8 months from initial engagement to license approval. Our proven methodology ensures efficient progression through each stage while maintaining comprehensive compliance with all regulatory requirements.

The following timeline represents typical duration for standard applications. Complex business models, incomplete documentation, or regulatory queries may extend the process. Conversely, well-prepared applications with straightforward business models may achieve faster approval.

The licensing journey begins with comprehensive assessment of your business model, determining regulatory requirements, and establishing project roadmap.

Key Activities:

Business Model Analysis: Detailed review of your proposed services, target markets, technology infrastructure, and operational arrangements to determine applicable MiCA requirements and appropriate license class.

Jurisdiction Optimization: Evaluation whether Czech Republic represents optimal jurisdiction for your specific business, considering alternatives if appropriate.

KYC Document Collection: Gathering identification documents, certificates of non-criminal record, CVs, and other personal documentation from all shareholders and key personnel.

Power of Attorney Preparation: Drafting and executing powers of attorney authorizing our team to act on your behalf in dealings with Czech authorities.

Company Name Verification: Checking availability of proposed company name in Czech Commercial Register and reserving if available.

Project Planning: Developing detailed project timeline, budget, and resource allocation plan.

Deliverables:

– Comprehensive regulatory assessment report
– Detailed project timeline and budget
– List of required documents and information
– Preliminary company structure recommendation
– Initial compliance gap analysis

This phase establishes clear roadmap and ensures all stakeholders understand requirements, timeline, and investment needed for successful licensing.

With preliminary assessment complete, we proceed to establish the Czech legal entity that will hold the CASP license.

Key Activities:

Founding Documents Preparation: Drafting Articles of Association (Společenská smlouva) and other founding documents in Czech language, incorporating appropriate provisions for regulated entity.

Notarization: Arranging notarial authentication of founding documents and shareholder signatures (can be done remotely for foreign shareholders through apostilled powers of attorney).

Commercial Register Filing: Submitting incorporation documents to the Czech Commercial Register along with required fees (approximately CZK 6,000 / €240).

Tax Registration: Registering the company with Czech tax authorities for corporate income tax, VAT (if applicable), and employer obligations.

Share Capital Deposit: Opening temporary bank account and depositing required share capital (€125,000 or €150,000 depending on class). The capital must remain in the account throughout the licensing process.

Office Lease: Securing physical office space in Czech Republic and executing lease agreement.

Timeline: Company registration typically completes within 10-15 business days from Commercial Register submission. Total phase duration including preparation is 2-3 weeks.

Deliverables:

– Certificate of Incorporation (Výpis z obchodního rejstříku)
– Company registration number (IČO)
– Tax identification number (DIČ)
– Bank account with deposited share capital
– Office lease agreement

The company is now legally established and ready to proceed with CASP license application preparation.

This phase represents the most intensive work, developing comprehensive compliance framework tailored to your business model and MiCA requirements.

Key Activities:

Policy Development: Our compliance specialists draft complete suite of policies and procedures covering all mandatory areas: AML/KYC, transaction monitoring, client asset protection, cybersecurity, risk management, outsourcing, conflicts of interest, complaints handling, and data protection.

Programme of Operations: Preparing detailed description of your business model, services, target markets, technology infrastructure, organizational structure, and operational arrangements.

Risk Assessment: Conducting comprehensive risk assessment identifying and evaluating risks across all operational areas (AML, operational, cybersecurity, legal, reputational) and documenting mitigation measures.

Internal Control Framework: Designing three-lines-of-defense model with clear allocation of responsibilities for risk management, compliance monitoring, and internal audit.

ICT Documentation: Documenting IT system architecture, security measures, business continuity arrangements, and incident response procedures.

Financial Projections: Preparing detailed financial forecasts demonstrating capital adequacy and sustainable business model.

Organizational Charts: Creating detailed organizational structure showing reporting lines, segregation of duties, and allocation of key functions.

MLRO Appointment: Identifying and appointing qualified Money Laundering Reporting Officer, either internal hire or through our outsourced MLRO service.

All documentation is prepared in English (acceptable to CNB) with Czech translations provided for key documents as needed. Our team ensures documentation reflects genuine understanding of your business rather than generic templates, significantly increasing approval likelihood.

Timeline: 6-8 weeks for comprehensive documentation package, depending on business complexity and client responsiveness in providing necessary information.

Deliverables:

– Complete AML/KYC Policy and Procedures Manual
– Risk Management Framework
– Programme of Operations
– Internal Control and Governance Framework
– ICT Security and Business Continuity Plans
– All other mandatory policies and procedures
– Financial projections and capital adequacy analysis

With all documentation prepared, we submit the comprehensive application package to the Czech National Bank and manage the regulatory review process.

Application Submission:

The CASP license application is submitted to the CNB through their designated submission process, including:

– Formal application letter
– Complete set of policies and procedures
– Programme of Operations
– Fit-and-proper documentation for all relevant persons
– Financial information and capital adequacy analysis
– Organizational structure and governance arrangements
– Evidence of physical office and local substance
– Application fee payment confirmation

Completeness Check (2-4 weeks):

Upon receipt, the CNB conducts initial completeness review to verify all required documents are submitted and properly formatted. If any items are missing or incomplete, the regulator issues request for additional information.

Responding promptly and comprehensively to completeness queries is critical—delays in providing requested information extend the overall timeline significantly.

Substantive Review (2-4 months):

Following successful completeness check, the CNB conducts detailed substantive assessment of the application, evaluating:

– Adequacy of business model and financial projections
– Quality and appropriateness of policies and procedures
– Fitness and propriety of shareholders and management
– Adequacy of organizational and operational arrangements
– Compliance with all MiCA requirements

During substantive review, the regulator typically issues multiple rounds of questions and requests for clarification or enhancement of documentation. This iterative dialogue is normal and expected.

Common Regulatory Queries:

– Clarification of specific operational procedures
– Enhancement of risk assessment or mitigation measures
– Additional detail on technology infrastructure or security measures
– Justification of capital adequacy calculations
– Clarification of outsourcing arrangements
– Additional information on beneficial ownership structure

Our Role During Review:

We manage all communication with the CNB on your behalf, including:

– Responding to all regulatory queries promptly and comprehensively
– Coordinating with you to obtain any additional information needed
– Revising documentation based on regulatory feedback
– Maintaining regular dialogue with CNB case officers
– Providing strategic guidance on regulatory expectations

Effective regulatory communication significantly impacts approval timeline. Our established relationships with Czech regulators and deep understanding of their expectations enable efficient navigation of the review process.

Timeline: The CNB’s official review period is up to 6 months from submission of complete application, though many applications receive approval in 3-5 months with proactive management.

Following successful completion of regulatory review, the CNB issues formal authorization decision granting the CASP license.

License Issuance:

The authorization decision includes:

– CASP license certificate
– Unique registration number
– Specification of authorized services
– Any conditions or limitations on authorization

The CASP is entered into the CNB’s public register of authorized crypto asset service providers, accessible on the CNB website.

Post-Authorization Requirements:

Commencement of Operations: The CASP must commence providing authorized services within 12 months of license issuance. Failure to commence operations within this timeframe may result in license revocation.

Bank Account Opening: With CASP license in hand, we proceed to open corporate bank account or EMI account for operational activities. This process typically requires 2-4 weeks and includes:

– Submission of application to partner banks/EMIs
– Enhanced due diligence review
– Account setup and onboarding
– Integration of payment processing infrastructure

We maintain established relationships with crypto-friendly banks and EMIs, significantly improving account opening success rates.

Notification of Commencement: Before beginning operations, the CASP must notify the CNB of the intended commencement date and confirm all operational arrangements are in place.

Ongoing Compliance Setup: Establishing procedures for ongoing regulatory obligations including:

– Regular reporting to CNB and FAU
– Transaction monitoring and suspicious activity reporting
– Maintenance of client records and transaction data
– Periodic compliance reviews and updates
– Staff training programs

Timeline: From license approval to operational readiness typically requires 2-4 weeks, primarily driven by bank account opening timeline.

Deliverables:

– CASP license certificate and registration number
– Operational bank/EMI account
– Confirmation of commencement to CNB
– Ongoing compliance calendar and procedures

Congratulations—you are now a licensed CASP authorized to provide crypto asset services throughout the European Union!

Czech Republic offers competitive and straightforward tax regime for crypto businesses, with clear treatment of crypto-related income and extensive network of double taxation treaties.

Corporate Income Tax (CIT):

Czech companies are subject to 21% corporate income tax on worldwide profits. This rate is competitive within the EU and significantly lower than many Western European jurisdictions (e.g., Germany 30%, France 25%).

Tax Residency: Companies incorporated in Czech Republic are automatically Czech tax residents and taxed on worldwide income. Proper tax planning and utilization of double taxation treaties can optimize overall tax burden for international groups.

Value Added Tax (VAT):

Standard VAT rate in Czech Republic is 21%. However, crypto-related services receive specific treatment:

VAT-Exempt Services: Exchange of crypto-assets for fiat currency or other crypto-assets is exempt from VAT, following the landmark CJEU decision in Case C-264/14 (Hedqvist). This means:

– No VAT charged on exchange transactions
– No input VAT recovery on related costs
– Simplified VAT compliance for exchange businesses

VAT-Taxable Services: Other crypto-related services may be subject to standard 21% VAT:

– Custody and wallet services (potentially)
– Advisory and consulting services
– Software licensing
– Transaction fees (treatment depends on characterization)

VAT treatment of specific services should be confirmed through binding tax ruling from Czech tax authorities, as interpretation continues to evolve.

Withholding Tax on Dividends:

Dividend distributions to shareholders are subject to 15% withholding tax (35% for payments to non-cooperative tax jurisdictions). However, withholding may be reduced or eliminated under:

EU Parent-Subsidiary Directive: 0% withholding on dividends paid to qualifying EU parent companies (holding ≥10% for ≥12 months)

Double Taxation Treaties: Czech Republic has extensive treaty network (over 90 treaties) providing reduced withholding rates, typically 5-10% for substantial holdings

Social Security and Health Insurance:

Employers must pay social security contributions (24.8% of gross salary) and health insurance contributions (9% of gross salary) for Czech employees. These costs should be factored into personnel budgeting.

Transfer Pricing:

Czech Republic applies OECD transfer pricing guidelines. Transactions with related parties (including international group entities) must be conducted at arm’s length with appropriate documentation. This is particularly relevant for:

– Management fees and service charges
– Licensing of technology or intellectual property
– Intra-group financing arrangements

Tax Incentives:

Czech Republic offers various tax incentives for qualifying activities:

– R&D tax deductions (up to 110% of eligible costs)
– Investment incentives for job creation and strategic investments
– IP Box regime (reduced taxation on qualifying IP income)

Crypto companies engaged in technology development may benefit from these incentives with proper structuring.

Tax Compliance:

Czech companies must:

– File annual corporate income tax returns (deadline: typically 3-6 months after year-end)
– Submit monthly/quarterly VAT returns (if VAT-registered)
– Maintain proper accounting records in accordance with Czech accounting standards
– Prepare annual financial statements (audited if meeting size thresholds)

We work with experienced Czech tax advisors to ensure full compliance and optimal tax efficiency for your crypto business.

Obtaining the CASP license is only the beginning—maintaining compliance with ongoing regulatory obligations is essential for continued authorization and avoiding sanctions.

Regulatory Reporting Requirements:

To Czech National Bank (CNB):

– Periodic Reporting: Regular reports on business activities, financial condition, and compliance status (frequency determined by CNB, typically quarterly or semi-annually)
– Material Changes Notification: Immediate notification of significant changes including:
– Changes in shareholders or beneficial owners
– Changes in management or key function holders
– Changes in business model or services offered
– Changes in outsourcing arrangements
– Significant operational incidents or breaches
– Annual Compliance Report: Comprehensive annual report on compliance framework effectiveness, including internal audit findings and remediation actions

To Financial Analytical Office (FAU):

– Suspicious Activity Reports (SARs): Immediate reporting of transactions suspected to involve money laundering or terrorist financing
– Threshold Reporting: Reporting of transactions exceeding specified thresholds (currently €15,000 for occasional transactions)
– Annual AML Report: Summary of AML/CFT activities, training, and effectiveness

Capital Adequacy Maintenance:

CASPs must continuously maintain minimum capital requirements (€125,000 or €150,000 depending on class) plus additional capital based on operational costs. The CNB may require capital increases if business growth or risk profile changes warrant higher capital buffers.

Policy and Procedure Updates:

All policies and procedures must be reviewed and updated at least annually, or more frequently when:

– Regulatory requirements change
– Business model or services change
– Operational experience identifies deficiencies
– New risks emerge

Updated policies must be approved by management and communicated to all relevant staff.

Staff Training:

CASPs must provide regular training to all employees on:

– AML/CFT requirements and procedures
– MiCA compliance obligations
– Cybersecurity and data protection
– Fraud prevention and detection
– Customer protection and fair treatment

Training must be documented, and records maintained for regulatory inspection.

Internal Audit:

Depending on size and complexity, CASPs may be required to establish internal audit function to provide independent assessment of:

– Compliance framework effectiveness
– Internal control adequacy
– Risk management processes
– Operational efficiency

Internal audit findings must be reported to management and supervisory body, with remediation plans for identified deficiencies.

External Audit:

CASPs meeting certain size thresholds must have annual financial statements audited by independent auditor. The audit scope may include review of compliance with regulatory requirements.

Incident Reporting:

CASPs must report to the CNB:

– Operational Incidents: Significant operational disruptions, system failures, or service outages
– Security Breaches: Cybersecurity incidents, data breaches, or unauthorized access
– Compliance Breaches: Material violations of regulatory requirements

Reporting must occur promptly (typically within 24-72 hours of discovery) with detailed incident reports following.

Client Asset Protection:

Ongoing obligations include:

– Daily reconciliation of client assets
– Regular attestation of segregation arrangements
– Maintenance of adequate insurance or capital buffers
– Client disclosure of asset protection arrangements

Transaction Monitoring:

Continuous monitoring of all transactions for:

– Suspicious patterns indicating money laundering or fraud
– Sanctions screening (OFAC, EU, UN lists)
– PEP identification and enhanced due diligence
– Unusual activity requiring investigation

Record Keeping:

CASPs must maintain comprehensive records for specified retention periods:

– Client identification and due diligence: 5 years after relationship ends
– Transaction records: 5 years after transaction
– Compliance documentation: 5 years
– Financial records: 10 years (Czech accounting law)

Records must be readily accessible for regulatory inspection.

Supervision Fees:

The CNB charges annual supervision fees to CASPs, calculated based on company size and activities. Fees typically range from €1,000-€5,000 annually but may be higher for large or complex operations.

Consequences of Non-Compliance:

Failure to meet ongoing obligations can result in:

– Regulatory warnings and reprimands
– Fines (up to €5,000,000 or percentage of turnover)
– Restrictions on business activities
– Suspension of license
– Revocation of license
– Criminal prosecution for serious violations

Maintaining robust compliance culture and dedicating adequate resources to ongoing compliance is essential for long-term success.

Securing banking services represents one of the most significant challenges for crypto businesses. Despite holding regulatory licenses, many CASPs struggle to open and maintain bank accounts due to banks’ risk appetite and internal policies.

The Banking Challenge:

Traditional banks remain cautious about crypto businesses due to:

– Perceived money laundering and fraud risks
– Regulatory uncertainty and compliance costs
– Reputational concerns
– Lack of understanding of crypto business models
– High operational costs for enhanced due diligence

Even licensed CASPs with robust compliance frameworks face rejection from multiple banks before securing banking services.

Our Banking Solutions:

We have established relationships with crypto-friendly banks and Electronic Money Institutions (EMIs) that understand crypto businesses and provide reliable banking services to licensed CASPs.

Partner Banks and EMIs:

We work with multiple banking partners across the EU, including:

– Specialized crypto-friendly banks
– EMIs with crypto expertise
– Payment service providers supporting crypto businesses
– Multi-currency account providers

Our partners offer:

– Corporate accounts in EUR and other major currencies
– SEPA and SWIFT payment processing
– Multi-currency capabilities
– Online banking platforms
– Dedicated relationship managers
– Reasonable fee structures

Account Opening Process:

1. Partner Selection: Based on your business model, transaction volumes, and currency needs, we recommend optimal banking partner(s).

2. Application Preparation: We prepare comprehensive application package including:
– CASP license and company documentation
– Business plan and financial projections
– Compliance framework documentation
– Beneficial ownership information
– Source of funds documentation

3. Enhanced Due Diligence: Banks conduct thorough review of application, often including:
– Video calls with management
– Detailed questions about business model and controls
– Review of compliance policies
– Assessment of AML/CFT framework

4. Account Approval: Following successful due diligence, bank approves account opening and provides account details.

5. Onboarding: Setup of online banking access, payment processing integration, and operational procedures.

Timeline: Account opening typically requires 2-4 weeks from application submission to account activation, though complex cases may take longer.

Account Opening Success Rate:

Through our established banking relationships and proper application preparation, we achieve over 90% success rate for account opening for licensed CASPs. We provide account opening assistance with guarantee—if we cannot secure account through our partners, we refund account opening service fees.

Ongoing Banking Relationship Management:

Maintaining banking relationships requires:

– Responsive communication with bank compliance teams
– Prompt provision of requested information
– Regular transaction monitoring and reporting
– Notification of material business changes
– Maintenance of adequate compliance standards

We provide ongoing support for banking relationship management, helping clients navigate bank requests and maintain good standing.

Alternative Solutions:

For businesses unable to secure traditional banking, we can assist with:

– Multiple EMI accounts for operational redundancy
– Crypto-to-crypto payment rails
– Stablecoin treasury management
– Hybrid banking solutions

Czech Republic offers compelling combination of regulatory efficiency, cost-effectiveness, and strategic advantages for crypto businesses seeking European market access.

Selecting the optimal jurisdiction for CASP licensing requires careful evaluation of multiple factors including timeline, costs, regulatory environment, and strategic considerations. The following comparison helps contextualize Czech Republic’s position among popular European crypto licensing jurisdictions.

Jurisdictional Comparison: Key Parameters

When Czech Republic is Optimal Choice:

Czech Republic represents ideal jurisdiction for:

– Companies prioritizing balance of speed and regulatory quality
– Businesses seeking cost-effective EU licensing without compromising standards
– International groups preferring pragmatic regulatory environment
– Companies planning significant European operations requiring stable jurisdiction
– Businesses valuing responsive regulatory communication and support

When to Consider Alternatives:

Lithuania: If absolute speed is priority and you accept higher regulatory uncertainty and potential rejection risk

Poland: If targeting primarily Central/Eastern European markets and prefer Polish language/culture

Germany/Austria: If requiring maximum regulatory prestige for institutional clients or complex financial products (though at significantly higher cost and timeline)

Our Recommendation:

For most crypto businesses seeking European licensing, Czech Republic offers optimal combination of:
– Reasonable timeline (faster than Western Europe, more reliable than Lithuania)
– Competitive costs (significantly lower than Germany/Austria)
– High regulatory standards (full MiCA compliance)
– Pragmatic regulatory approach (business-friendly while maintaining rigor)
– Strategic location and operational advantages

We assist clients in comprehensive jurisdictional analysis during initial consultation, ensuring selection of optimal jurisdiction for your specific business model, target markets, and strategic objectives.

For businesses requiring fastest possible market entry, acquiring a ready-made company with existing CASP license offers compelling alternative to new license application.

What is a Ready-Made Licensed Company?

A ready-made (or “shelf”) company is a pre-incorporated legal entity that has already obtained CASP license but has not yet commenced operations. These companies are held in inventory by specialized providers and can be transferred to new owners significantly faster than obtaining new license.

Advantages of Ready-Made Solution:

Speed: Market entry in 2-3 months versus 6-8 months for new license application

Certainty: License already approved—no application risk or regulatory uncertainty

Immediate Operations: Begin business activities immediately after ownership transfer and regulatory notification

Established Structure: Company infrastructure, compliance framework, and documentation already in place

The Acquisition Process:

1. Company Selection (1 week):
– Review available companies and their authorized services
– Verify license scope matches your business requirements
– Conduct due diligence on company history and structure

2. Purchase Agreement (1-2 weeks):
– Negotiate purchase terms and price
– Execute share purchase agreement
– Arrange payment and escrow (if applicable)

3. Ownership Transfer (2-4 weeks):
– Transfer shares to new owners
– Update Commercial Register with new shareholders
– Replace directors and key personnel
– Update bank account signatories

4. Regulatory Notification (2-4 weeks):
– Notify CNB of ownership change
– Submit fit-and-proper documentation for new owners/directors
– Update compliance documentation for new structure
– Obtain CNB approval of changes

5. Operational Adaptation (2-4 weeks):
– Customize policies and procedures for your business model
– Establish banking relationships
– Integrate technology systems
– Train personnel

Total Timeline: 8-12 weeks from initial selection to operational readiness

What’s Included:

– Czech s.r.o. company with clean history
– Valid CASP license with specified authorized services
– Basic compliance documentation and policies
– Registered office address
– Company bank account (subject to bank approval of new owners)

What You Need to Provide:

– New shareholders and directors (subject to fit-and-proper approval)
– Updated business plan and operational arrangements
– Customization of policies for your specific business model
– Ongoing compliance resources

Costs:

Ready-made licensed companies typically cost €200,000-€400,000 depending on:
– Scope of authorized services
– Company history and reputation
– Market demand and availability
– Included assets and infrastructure

While significantly more expensive than new license application, the time savings and certainty may justify premium for businesses with urgent market entry requirements or time-sensitive opportunities.

Important Considerations:

Regulatory Approval Required: Ownership transfer requires CNB approval of new shareholders and directors through fit-and-proper assessment. Approval is not automatic—unsuitable owners may be rejected.

Limited Customization: Authorized services are fixed by existing license. Adding new services requires license amendment through standard regulatory process.

Due Diligence Essential: Thorough due diligence on company history, previous owners, and any regulatory issues is critical to avoid inheriting problems.

Banking Challenges: Existing bank accounts may be closed upon ownership change, requiring new account opening with associated challenges.

Availability:

Ready-made licensed CASP companies are limited in availability. We maintain relationships with providers and can source suitable companies based on your requirements.

Companies currently operating under Czech national VASP registration must transition to MiCA CASP licensing to continue operations beyond July 1, 2026.

Critical Deadlines:

July 31, 2025: Final deadline for existing VASPs to submit CASP license applications to benefit from transitional provisions

July 1, 2026: End of transitional period—all crypto service providers must hold valid MiCA CASP licenses or cease EU operations

Transitional Provisions:

VASPs that were authorized under national regimes before December 30, 2024, and submit complete CASP applications by July 31, 2025, may continue operations during application review under transitional provisions.

This grandfathering mechanism prevents business disruption while applications are processed, provided:

– VASP was properly authorized under national law before December 30, 2024
– Complete CASP application submitted by July 31, 2025
– VASP maintains compliance with national requirements during transition
– No material changes to business model or services during transition

Transition Process:

1. Gap Analysis (2-4 weeks):
– Compare current operations and compliance framework with MiCA requirements
– Identify deficiencies requiring remediation
– Assess whether current services fit within MiCA CASP categories
– Determine appropriate CASP class

2. Compliance Enhancement (4-8 weeks):
– Update policies and procedures to MiCA standards
– Enhance AML/KYC framework if necessary
– Strengthen cybersecurity and operational resilience measures
– Implement additional controls for client asset protection
– Develop comprehensive Programme of Operations

3. Corporate Restructuring (if needed) (2-4 weeks):
– Increase share capital if below MiCA minimums
– Adjust governance structure if necessary
– Appoint additional key function holders
– Enhance local substance if current arrangements insufficient

4. Application Preparation and Submission (2-4 weeks):
– Compile comprehensive application package
– Prepare fit-and-proper documentation
– Submit application to CNB well before July 31, 2025 deadline

5. Regulatory Review (3-5 months):
– CNB reviews application
– Respond to regulatory queries
– Make any required adjustments
– Continue operations under transitional provisions

6. License Approval:
– Receive CASP license
– Transition from national VASP registration to MiCA authorization
– Update all documentation and client communications

Recommended Timeline:

We strongly recommend existing VASPs begin transition process immediately. Waiting until close to July 31, 2025 deadline creates significant risks:

– Insufficient time for thorough gap analysis and remediation
– Rushed application preparation increasing error risk
– Potential for incomplete applications not qualifying for transitional provisions
– CNB processing capacity constraints as deadline approaches
– No buffer for unexpected complications

Ideal Timeline:
– Start transition process: Q1 2025
– Complete gap analysis and remediation: Q2 2025
– Submit application: Q2-Q3 2025 (well before deadline)
– Receive approval: Q4 2025 – Q1 2026

Consequences of Missing Deadline:

VASPs that fail to submit complete applications by July 31, 2025:

– Cannot benefit from transitional provisions
– Must cease operations on July 1, 2026 if not yet licensed
– Face potential regulatory sanctions for unauthorized activity
– Lose competitive position and client relationships
– May face difficulties obtaining license after deadline due to unauthorized operation history

Our Transition Support Services:

We provide comprehensive support for VASP-to-CASP transition:

– Detailed gap analysis comparing current state with MiCA requirements
– Compliance framework enhancement and policy updates
– Corporate restructuring if needed
– Complete CASP application preparation and submission
– Regulatory liaison throughout review process
– Post-approval implementation support

Transition Package Pricing: €45,000-€75,000 depending on gap analysis findings and required enhancements

Since 2017, we have established ourselves as leading provider of crypto licensing services across European jurisdictions, helping hundreds of companies navigate complex regulatory requirements and achieve successful authorization.

Our Expertise:

Deep Regulatory Knowledge: Our team includes legal experts, compliance specialists, and former regulators with comprehensive understanding of MiCA requirements and national implementation across EU member states.

Proven Track Record: We have successfully obtained crypto licenses in Czech Republic, Lithuania, Poland, Estonia, and other European jurisdictions, with approval rate exceeding 95% for properly prepared applications.

Czech Market Specialization: We maintain strong relationships with Czech National Bank and deep understanding of Czech regulatory expectations, enabling efficient navigation of the licensing process.

End-to-End Service: From initial assessment through post-licensing compliance support, we provide comprehensive services covering every aspect of regulatory authorization and operational setup.

Our Approach:

Tailored Solutions: We recognize every business is unique. Our services are customized to your specific business model, risk profile, and strategic objectives rather than applying generic templates.

Transparent Communication: We provide clear, honest assessment of requirements, timeline, and costs from the outset, with regular updates throughout the process. No surprises or hidden fees.

Proactive Management: We anticipate regulatory questions and address potential issues before they arise, significantly improving approval timeline and reducing back-and-forth with regulators.

Quality Documentation: Our compliance documentation reflects genuine understanding of your business and demonstrates robust risk management, not generic templates that regulators easily identify and reject.

Client Success Focus: Your success is our success. We invest significant effort in understanding your business and ensuring the compliance framework we build is not only regulatory-compliant but also practical and sustainable for your operations.

What Sets Us Apart:

Comprehensive Service Packages: From assessment-only to complete turnkey solutions, we offer flexible packages matching different client needs and budgets.

Established Banking Relationships: Our partnerships with crypto-friendly banks and EMIs significantly improve banking access for licensed clients.

Ongoing Support: We don’t disappear after license approval. Our ongoing compliance support services help clients maintain regulatory good standing and adapt to evolving requirements.

Multijurisdictional Capability: If Czech Republic isn’t optimal for your business, we can assist with licensing in alternative European jurisdictions, providing objective advice on best fit.

Responsive Communication: Dedicated project managers ensure prompt responses to your questions and concerns throughout the engagement.

Our Commitment:

We are committed to delivering:

– Regulatory Approval: Successful CASP license authorization
– Efficiency: Optimal timeline without compromising quality
– Value: Competitive pricing with transparent cost structure
– Quality: High-standard documentation and compliance frameworks
– Support: Responsive, professional service throughout engagement and beyond

Client Testimonials:

“[Your firm] provided exceptional support throughout our Czech CASP licensing process. Their deep regulatory knowledge and proactive approach to addressing CNB queries resulted in approval in just 7 months. The compliance framework they developed is not only regulatory-compliant but also practical for our daily operations.”
— CEO, European Crypto Exchange

“After struggling with bank account rejections, [your firm] connected us with appropriate banking partners and successfully opened accounts within 3 weeks. Their established relationships and proper application preparation made all the difference.”
— CFO, Crypto Custody Provider

“The team’s expertise in MiCA requirements and Czech regulatory expectations was evident throughout the process. They anticipated regulatory questions and prepared comprehensive responses, significantly reducing back-and-forth with the CNB. Highly recommended.”
— Compliance Officer, Crypto Payment Processor

Ready to obtain your Czech CASP license and access the European crypto market? We’re here to help you navigate the regulatory process efficiently and successfully.

Next Steps:

1. Schedule Free Consultation: Book a 30-minute consultation call with our regulatory experts to discuss your business model, timeline, and requirements.

2. Receive Preliminary Assessment: We’ll provide initial assessment of your licensing requirements, recommended approach, and estimated timeline and costs.

3. Engage Our Services: Select appropriate service package and begin the licensing process with our comprehensive support.

4. Achieve Authorization: Work with our team through each phase of the process to successful CASP license approval.