License for Cryptocurrency in Estonia – Brief Review

It’s more than a year since the Terrorist Financing prevention and Money laundering act was adopted for license for cryptocurrency business in Estonia by the Estonian government. Thereby leading to 2 types of licenses: license for crypto-exchange operations and a license for crypto-wallets.
This act has also assisted many companies engaged in cryptocurrency to understand if they’re required to apply for a license or if they can operate without any license.

Many reports have revealed that Estonia is the first country which was able to introduce such an act within the European Union boundaries. Act led to the rise many international clients who are engaged in cryptocurrency exchange business visiting Estonia so that they can obtain business licenses.
It’s more than a year since this new law was implemented, not only many licenses have been issued to many businesses but also many challenges have been accepted.

The above-mentioned act was able to replace the previous outdated definition of provider of an alternative means of payment. This new act also included crypto business.

What was the report about

According to the report which was revealed by the Registrar of economic activities in Estonia, almost 700 licenses have been issued for the crypto exchange service providers and about 600 licenses have been issued to the crypto wallet service providers.

One of the benefits of doing a cryptocurrency business is that the process of obtaining a license for cryptocurrency in Estonia is relatively fast and easy. It’s only a few documents which are needed during the registration of your business. Moreover official time-frames for application review by the FIU is 30 days.
Based on the experience that we have got, application for license for cryptocurrency in Estonia can be reviewed within 1 to 2 weeks in case the applicants submit all the documents and the FIU doesn’t have any additional queries.

It’s a MUST that any licensed company has to comply with all the rules and requirements which are set out in the above, for instance, setting up the AML/KYC procedure. It’s important for you to know that FIU has a right to revoke crypto licenses in situations where a business does not start operating within 6 months after they’ve been issued with a license.

One of the main challenges for the business entities which are operating with the crypto exchange field is opening their business bank account. Up to now the banks in Estonia are reluctant in serving the crypto related clients.
Normally, many companies do open business bank accounts in other countries and then cooperate with various payment service providers, for instance, payment institutions and electronic money institutions.