Cryptocurrencies are becoming more and more commonplace in a world that was once very resistant to virtual assets. In 2020, Lithuania joined the ranks of countries that are open to cryptocurrency, and the number of virtual asset companies in the country has been growing ever since.
Recently, Lithuania has implemented new regulations for Virtual Asset Service Providers (VASPs). The final step in this process was the launch of a Register for VASPs, which was unveiled in early February 2023. So far, there are more than 260 companies that have been added to this list. However, according to Gofaizen & Sherle, a fintech and crypto consultancy, most of the VASPs are expected to be added to the register in the near future.
The Register of VASPs will make it easier for users to identify and evaluate licensed crypto firms in the region. Thanks to this, the crypto industry in Lithuania can become a more transparent and trustworthy environment. This will also make Lithuania a more profitable and efficient crypto market.
Keep reading to learn more about Lithuania’s cryptocurrency regulations.
The Regulatory Framework for VASPs in Lithuania
The laws concerning cryptocurrencies vary from one country to another. Lithuania requires crypto companies to obtain a license to be able to operate legally. The Government of Lithuania has also revised the AML/CTF LAW for virtual asset firms.
Under the new regulations, the list of companies that provide virtual currency exchange services will be publicly available on the Registry Centras website. The Government has also reduced the number of VASPs in the country from around 800 to about 200, in order to ensure proper regulation of the crypto market and prevent illegal activities.
The two types of VASPs now registered in the region are virtual currency exchange operators and virtual currency wallet operators.
Here are some of the changes to the legislation for crypto firms:
- Crypto companies can now obtain a single license in Lithuania. Registry Centras will supervise the process.
- The minimum capital for a cryptocurrency firm has been raised to 125,000 EUR.
- The VASP must have an in-house AML manager who works exclusively for that company.
- A senior manager of the company must be a permanent resident of Lithuania.
- Members of the management team and supervisory bodies must not have criminal records.
For a full list of the updated laws, click here.
How To Obtain Crypto Authorization in Lithuania
Getting a VASP license in Lithuania has a straightforward procedure. The first step is to submit a notice to the relevant authorities. Here are the other steps:
- Register A Company in Lithuania: To get authorization, register a limited liability company with a minimum share capital of 125,000 EUR in the administrative account at a local bank.
- Compliance with AML/CFT Documentation: Develop and implement AML/CFT measures and incorporate them into your company’s internal activities.
- Registration For Cryptocurrency and Virtual Asset Exchange Activities: To get a crypto license, notify the relevant authorities. Then register your company as a virtual currency exchange operator or a crypto depository wallet operator. You must also appear in the Register of Legal Entities of Lithuania.
- Creating an administrative account: This account is essential for all virtual asset service providers, as it provides a secure payment channel for their clients.
- Involve an officer: A virtual asset company will need the services of a money laundering report officer (MLRO) or anti-money laundering (AML) officer. This officer will monitor all transactions and submit a notice for suspicious transactions to the regulatory bodies.
- Notify the regulatory body of the responsible persons implementing regulatory measures: All companies that exchange or store virtual assets must notify the Financial Crime Investigation Service (FCIS) in writing. Also, list the contact details of the director and other personnel involved in money laundering prevention.
Conclusion
It is mandatory for all virtual asset service providers (VASPs) to join the commercial register in Lithuania. While the list already has more than 260 companies, many more are adapting to the new legislation and will soon be added.
The Lithuanian Government has recently amended its regulations for VASPs in the country. These changes are outlined in a document and are now in effect. The new crypto regulations are aimed at fighting money laundering and terrorist financing, while also protecting the interests of crypto users. Through these measures, the Lithuanian government is demonstrating its support for the growth and development of the crypto market, making the country an attractive area for investment and innovation.
