Failed firms will be forced to leave the local market

Lithuania will introduce licensing of crypto companies in 2025

03.04.2024 - 15:15

112

2 min

What’s new? Lithuanian authorities will tighten requirements for crypto companies operating in the local market and introduce mandatory licensing of digital asset-related activities from 2025. According to the Central Bank, weak regulation has led to a number of high-profile bankruptcies and fraud cases around the world, which has been a major blow to the industry.

Material by Bloomberg

What else is known? There are about 580 crypto companies registered in Lithuania, but the Central Bank expects a much smaller number to meet the necessary criteria to obtain a license. The licensing process will be completed by June 2025, and firms that fail to pass will have to “leave the ecosystem.”

Seven major global crypto exchanges already operate in Lithuania. Some crypto firms already have licenses in other EU countries, so they may not need to be licensed in Lithuania, the regulator said.

Lithuania’s desire to establish itself as a financial and technological hub has provoked an influx of unregulated crypto firms, which could create problems amid the implementation of the pan-European crypto regulation MiCA, aimed at combating money laundering and protecting investors. MiCA will come into force in January 2025.

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Earlier, mandatory licensing of crypto firms was approved by the authorities of Estonia and Argentina.

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