Bitcoin News has been following Estonia’s cryptocurrency march with some interest this year, and with over 900 licenses granted within the first year of the regulator’s initial registration ruling in that country, there seems to be no stopping its enthusiasm for the enterprise.
Estonia was one of the first jurisdictions in the EU to legislate cryptocurrencies and many companies are now doing business there. The Baltic region is fast becoming a northern crypto-paradise with Lithuania, Latvia, and Estonia all experiencing a recent economic boom. This has made Estonia a breeding ground for new startups.
Even its neighbor Latvia, though behind Estonia in cryptocurrency adoption, is beginning to make real inroads into developing a positive input to the industry. In March 2018, Latvia hosted an international discussion between industry experts on the future of fintech in the Baltics and the overall EU, which featured the vice-president of the European Commission Valdis Dombrovskis as keynote speaker.
But it’s Estonia breaking the records at present due to a progressive approach to cryptocurrency, despite the country abandoning its plans to introduce its own cryptocurrency after being warned by President of the European Central Bank Mario Draghi earlier this year.
500 licenses have been issued to date with over 400 wallet providers also being issued permission to operate. It appears that obtaining a license to operate a platform in Estonia is relatively simple according to Nikolay Demchuk from the law firm Njord which works in the sector. As Estonia operates under EU rules, the main emphasis on obtaining accreditation is complying with local and EU rules. Businesses applying also need to prove that they can operate with adequate KYC and AML protection.
Approval only takes about two weeks and are issued by the local regulator, the Estonian Financial Intelligence Unit (FIU), but companies must begin operating within six months of receiving their licenses under the pressure of losing them.
The biggest drawback in Estonia concerns banking as there is still a reluctance among the country’s banking community to provide services to cryptocurrency exchanges. However, the e-residency program, introduced in 2014, allows non-Estonians access to Estonian services such as company formation, banking, payment processing, and taxation. The program also allows anyone in the world to apply for a digital ID card and gain access to Estonian e-services when planning to start a company in the country.
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