An Overview of Cryptocurrency License in Estonia
Most businessmen decided on Estonia for their ICO, IDO, IEO or cryptocurrency business; on the top of it, they keep on doing their business there. The number cryptocurrency projects launched in Estonia is on the rise. Since 2017 more than 2000 companies got their cryptocurrency license in Estonia.
Estonia is ranked first in the world in number of unicorns per capita, moreover Estonia is among the top global countries, for the Internet availability and speed which makes it the comfortable place to do business related to crypto-currency and blockchain projects.
Benefits of Cryptocurrency License in Estonia
Terms
It takes only 3 months to register a company and get cryptocurrency license in Estonia to operate the crypto-currency project.
Legislation
In 2017 Estonia was one of the first countries in the world which introduced cryptocurrency regulation. Crypto/blockchain projects can apply for virtual currency service license. (Till 10.03.2020 there were two licenses: for exchanging a virtual currency against a fiat currency and providing a virtual currency wallet service).
Cost
The Cryptocurrency exchange license in Estonia is 3 to 4 times lower than in Malta, Singapore, Switzerland or the USA. Virtual Currency Service License price starts from 5 900 EUR.
Regulatory bodies
Interaction with regulatory bodies and their accessibility is vital for blockchain projects. Communication and interface with the Financial Inspectorate and the Money Laundering Data Bureau in Estonia is much easier than in the US or Singapore: the required legal information, assistance in solving various issues within their jurisdiction, possibility to communicate in English and Russian languages.
E-residency
Estonia is open to any entrepreneur from all over the world and is recognized as one of the most developed countries in terms of digitalization and IT. A person who intends to do business in Estonia may apply for an e-residece card that allows access to all government services and simplifies communication with state authorities. This card prevents you from bureaucracy and saves a lot of your time.
Tax policy and 0% Tax
According to the OECD, the tax policy in Estonia is one of the most competitive tax policies in the world. There is no profit tax in Estonia. Bitcoins and altcoins are not subject to VAT. Yet, ICO projects are not taxed. That means that ICO attracted funds are not subject to profit tax until ICO dividends are distributed.
PFSER specialists will provide the following services:
Preliminary review and analysis of the business model, consultation;
Full support to establish a company;
Assistance with development of a compliance program; policies and procedures;
Full support to get a cryptocurrency license in Estonia;
Submission of all documents and applications to the Financial Inspection and Financial Intelligence Unit;
Legal address for the company, contact person service. If necessary, search for a separate office and staff hiring;
Payment of all state and notary duties;
Legal and accounting consultation.
We have helped more than 120 companies to get their cryptocurrency license in Estonia.
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FAQ (Frequently Asked Questions)
1. Is cryptocurrency business legal in Estonia?
Yes, since 2017, Estonia has been one of the first countries in the world that regulate a cryptocurrency market. As a result, everyone who meets certain conditions can get a license to provide cryptocurrency services.
2. What is the timeframe for applications?
According to Estonian law, you can register a company and obtain a license to work with cryptocurrencies within three months.
3. In which cases can a license be revoked?
The license may be revoked if the prohibition of the related economic activity has been applied to the subject by the court or in accordance with the law.
4. In which cases can a license be refused?
There are several most common reasons. The first one is the existence of criminal records or adverse media by the stakeholders. The second is a lack of experience in this field. The third and most common one is a weak infrastructure and arrangement.
5. What is the validity period of a cryptocurrency license in Estonia?
Officially issued licenses for cryptocurrency operations in Estonia are valid indefinitely.
6. Who can set up a crypto company in Estonia?
Any adult with transparent background, enough experience, and skills can set up a crypto company in Estonia. However, there are some restrictions for residents/citizens of certain countries. Please drop us a line if you have doubts about your home country.
7. How may I be sure that my planned business falls within the scope of the operating license?
In the past, business owners needed two licenses to perform various services. Still, now they are merged into the Virtual Asset Service Provider License, so this license covers any cryptocurrency operations. However, an additional permit might be required if you provide investment advice or investment-related activities.
If you pay for accountancy monthly, then annual costs for the company renewal won’t exceed 600 euros.
8. What is the requirement for the share capital of a cryptocurrency company?
The minimum amount of the share capital amounts to 100 000 EUR. The share capital has to be fully paid before approaching the regulator.
9. What does the taxation of the crypto company in Estonia look like?
There are no additional conditions for cryptocurrency companies. They are taxed as any other business in Estonia. It means that you do not pay income tax until dividends are distributed.
10. How can I get more information?
Private Financial Services provides a full range of corporate services in Estonia, including company registrations, bank accounts, license assistance, cryptocurrency and fintech projects, the gambling industry, and much more.
The Private Financial Services team will be happy to discuss matters in more detail.