Cyprus is known to be one of the most convenient jurisdictions for obtaining a crypto licence, and therefore the country is developing an ecosystem for startups, financial services and web3 businesses. Cyprus, as a part of the EU, has implemented MiCA regulations, which means compliance with the requirements and the ability to operate throughout the eurozone, but more on that later.
Why Choose Cyprus for a Crypto License
Advantages of Getting a Cryptocurrency License in Cyprus
Cyprus offers a clear regulatory structure for crypto businesses requiring a licence, making the licensing process quick and easy. In general, the jurisdiction attracts businesses with a low corporate tax rate, and a supportive regulator adds to these benefits.
Cyprus as a Hub for Blockchain and Crypto Startups
Cyprus is friendly and supportive of start-ups, web3 and fintech companies. Partners and banks in the country are used to working with modern companies and understand the needs of the crypto business. The presence of international companies and government support, a stable legal system, and EU membership make Cyprus an excellent starting point for the digital asset market.
Cyprus Crypto Regulation Overview
Key Requirements from CySEC and the AML Law
The Prevention and Suppression of Money Laundering and Terrorist Financing Law (“AML/CFT Law") requires that you obtain a CASP licence from the Cyprus Securities and Exchange Commission (CySEC) before you start providing crypto services. The company's start-up capital starts at €50,000 (for investment advice), €125,000 for most services (exchange, portfolio management, initial public offering, etc.) and €150,00 for complex services (custody of crypto assets or cryptographic keys, underwriting and/or placing of firmly committed crypto assets or providing platform services).
Legal Framework for Operating a Crypto Business in Cyprus
The legislation of Cyprus (in particular, the above-mentioned AML law) on the regulation of crypto assets is harmonised with the pan-European MiCA, which allows holders of Cyprus-issued crypto licences to operate not only within the country, but also to extend to other EU countries upon certification. This approach of the regulator will allow your crypto business to grow rapidly!
Types of Cyprus Crypto Licenses
Cyprus Crypto License – What It Covers
As you may already know, MiCA has changed the rules of the game in the EU, and Cyprus has implemented the changes dictated by the new regulation. Today, the previous VASP licences are a thing of the past, no longer issued and must be converted into new CASP licences. This crypto licence in Cyprus is universal, it all depends on the type and scope of services you plan to provide (as we mentioned above, CySEC has set different thresholds for the authorised capital). So now the CASP will allow you to provide investment advice, execute instructions and orders from clients, exchange cryptocurrency for fiat or for another cryptocurrency, initial public offering, portfolio management, wallet services, and more. The Cyprus crypto exchange licence is now also part of CASP.
And let's not forget that now your licence can be legalised in other EU countries, instead of obtaining it from scratch - thanks to MiCA.
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How to Obtain a Cyprus Cryptocurrency License
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Step-by-Step Process for Crypto License in Cyprus
The Cyprus crypto regulation defines the procedure you need to take to obtain a licence. It all starts with the opening of a company and the minimum authorised capital, which depends, as we have already said, on the list of services you want to provide. In addition, you need to prepare all the necessary documents and policies, develop a business plan, hire qualified staff, etc. After collecting all the documents, we submit an application to CySEC, and don't forget to pay the EUR 10,000 application fee.
Required Documents and Capital Requirements
As part of the application, you should submit constituent documents, business plans, descriptions of internal policies and procedures (including KYC, AML), information about the company's management, employees, beneficiaries, etc. The specific set of documents will depend on the list of services you plan to provide. The minimum authorised capital will also depend on the type of activity and will range from EUR 50,000 to EUR 150,000 (as we explained earlier). Let's not forget about the local office and director, compliance officer, etc.
Timeline and Regulatory Approvals
Once the application is accepted, CySEC will review it formally (whether all documents have been submitted) and then substantively to determine whether the company is eligible. The review period will depend on the complexity of the structure, completeness of the documents (by the way, CySEC may contact you with clarifications or additional explanations, etc.) The whole process takes 3 months or more, and upon successful completion, your company will be entered into the state open register.
Compliance After Licensing
Ongoing AML/KYC Obligations
So, you have obtained a cryptocurrency licence in Cyprus and become part of a modern web3 business. However, obtaining a licence is not everything. You have received a CASP and now you need to constantly comply with anti-money laundering and counter-terrorist financing measures, implement KYC/AML policies, check your customers and transactions, sources of funds, train internal staff, etc. and an AML officer will be responsible for this. With great power comes great responsibility!
Reporting and Supervision by CySEC
As CASP activities are strictly regulated and controlled by the state, the CySEC, in particular, exercises constant supervision over the entities listed in the register. This means that businesses need to submit the necessary reports and confirm compliance with the requirements and procedures. In case of changes in the company's structure, business policies or key personnel, it is imperative to notify the regulator in order to avoid liability and not lose the CASP licence.
Start Your Cyprus Crypto Company Today
Work With Experts to Get Your Crypto License Fast
So, obtaining a cryptocurrency license in Cyprus can be a gateway to your business in the EU. As you can see, the MiCA, according to which Cyprus has adapted its own crypto legislation, introduced a single CASP licence that can include various types of services. The process of obtaining a licence is described by both the regulator and the legislation, however, it can contain many pitfalls and nuances, ranging from the authorised capital and office to detailed business documents, policies and compliance. In order not to drown in authorisations and documents, to go through the authorisation process calmly and reliably, contact Icon.Partners - a reliable partner with deep experience in the modern business and web3 world. And let's move into the future together!
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"Their adept use of technology for communication and project management streamlined the entire process."
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