In comparison to international investment powerhouses such as the UK, Frane or Singapore, Estonia is cost-efficient in terms of starting a business. Estonia, once the colony of the Soviet Union, today is a proud member nation of the European Union. The country in the last decade has established its robust global image on the back of being a fully digitized country where 99% of the public services are managed online. With Estonia, the international investors have the freedom to set up a company in this Baltic nation just by obtaining the e-residency card and a physical address is a necessity post a recent amendment.
Cryptocurrency License in Estonia
There are two kinds of licenses offered by the Estonian government’s department. The first being the exchange license, this is for exchanging the virtual currency with fiat currency and vice versa. Now coming to the second type of crypto license is the digital currency wallet service.
Both the license types have an alike tax framework, legal and operational. The Estonian Financial Unit, FIU is responsible for issuing the license. The application process time of any of the license types is reviewed within a time period of 30 days, its acceptance and rejection, purely depend upon the documents and eligibility criteria of the cryptocurrency exchange license Estonia.
If you either apply for one license or both the licenses at the same time, all you’re is to pay off the application fee.
The Legal Requirements
Although the legal requirements are not quite complicated unlike other top investment destinations in Europe, there are certain legal obligations you need to adhere to. To register a business in Estonia, your company must have an authorized capital of 2500 Euros, however, there is no obligation to pay off the taxes at the time of company registration. Symbolically, the company can make a contribution of 1 Euro. The 2500 Euros will be the company’s liability to the shareholders.
The industry experts highly recommend that you prefer the Limited Liability Company for E-wallet and Exchange licenses, which can be founded by only one person, who may act the company’s director, shareholder, and even the AML officer. It is best if you appoint a resident of Estonia as a company’s AML since the Bureau of the Estonian police mainly communicate in the Estonia language, you’re going to have tough times in translating the information.
Now, coming to another critical aspect associated with setting up a cryptocurrency-related venture in Estonia is taxation. Estonian governments have always encouraged global investors to come to this Baltic country by having a 0% tax policy on their profits. And, for a Limited Liability Company, there is no Value Added Tax. One thing to note here is that if your company is hiring talent from Estonia, then your business must follow the rules & regulations of a resident Estonian company.
If you find it baffling to submit the application for cryptocurrency exchange license Estonia, speak to experts with Estonia market knowledge to assist you.