Which European Countries are the Best for Opening an Account for a Cryptocurrency Company?
Jurisdictions that regulate cryptocurrency business and provide a legal basis for such a business include such countries as: Great Britain, Liechtenstein, Switzerland, Gibraltar, Germany, Netherlands, Lithuania, and the Czech Republic.
Company registration for crypto activities in the UK is administered by the Financial Conduct Authority (FCA). The FCA has developed and implemented KYC, AML/CTF regulations and policies specifically for crypto assets. The FCA has introduced requirements for Virtual Asset Service Providers (VASP) given their freedom to promote innovation. As for opening a cryptocurrency account in the UK, there are cryptocurrency-friendly banks in the country that allow customers to use their issued credit and debit cards to freely buy and sell cryptocurrencies, make bank transfers to crypto exchanges, and withdraw assets from crypto investments.
In Gibraltar, activity of cryptocurrency companies is regulated at the state level, and it is possible to open an account in one of the financial institutions of Gibraltar. This country is considered one of the leaders in cryptocurrency regulation, both in Europe and in the world. Cryptocurrencies are not recognized as legal means of payment here, however, exchange of virtual currencies is regulated at the legislative level. The country is characterized as a low-tax jurisdiction, therefore, after registering a cryptocompany in Gibraltar, capital gains or dividends will not be taxed. You should bear in mind that local banks are quite selective about companies wishing to work with cryptocurrency, and only a few of them work with such clients. In order to open a bank account for cryptocurrencies in Gibraltar, it will be necessary to confirm that you have a local physical office and that the company employs local employees.
Cryptocurrencies in Germany are treated as financial instruments in accordance with the local law. In July 2021, new licensing requirements for cryptocurrency companies in Germany were adopted and, under the new regulatory mode, cryptocurrency business in Germany is highly regulated and must be carried out in compliance with the Anti-Money Laundering Law. It has also become possible to open a bank account for companies that are engaged in cryptocurrency transactions.
Foreign investors who want to enter the cryptocurrency market in Europe often focus on Switzerland. The country, in particular, its canton of Zug, is called the European crypto valley. Cryptocurrency regulation requirements in Switzerland are strict. But Swiss banks are still quite cautious with the customers whose activities are related to cryptocurrencies. There are not many institutions in the country that provide an opportunity to open an account for a cryptocompany. The exceptions are Falcon Private Bank, which accepts cryptocurrency investments, and Swissquote Bank and IG Bank, through which Bitcoin can be traded. Also, recently, the Swiss bank Hypothekarbank Lenzburg (Hypi) announced that it would provide an opportunity for foreign investors to open accounts for working with cryptocurrency. In all of these institutions, applicants will be subject to a thorough KYC check. Those who plan to open a cryptocurrency account in Switzerland will need to confirm an appointment of a resident director, presence of a local office and local staff.
The Maltese government has developed clear regulations and requirements for regulation of cryptocurrencies in Malta. In particular, these rules have affected the regulation of cryptocurrencies and ICO, certification of blockchain-based platforms, and licensing of technology service providers. A special body to control the digital innovation has also been created. Prior to introduction of these rules and regulations, Maltese banks often refused to open an account for a crypto company. After the local legislation has been transformed, it seems possible to open an account on a crypto exchange in Malta, but only if a local company is registered. It is worth noting that Malta has become one of the first jurisdictions where cryptocurrency related activities are fully regulated and legal.
Liechtenstein has been considered one of the leading jurisdictions for registering crypto businesses in Europe since 2018. The government of this country has developed effective laws to encourage foreign investment of crypto-companies in order to compete with such states as Switzerland. Today, launching a crypto-startup in Liechtenstein can be a profitable solution for many foreign investors, as the fintech industry is developing quite rapidly. You can open a cryptocurrency account in Liechtenstein in several banks. But it must be taken into account that each client undergoes a thorough check and is considered individually, according to the strict rules of the institutions.
Currently, Lithuania is becoming one of the most cryptocurrency-friendly and attractive jurisdictions in the European Union, where legal transactions with cryptocurrencies are possible and clear requirements have been developed regarding regulation of crypto-currency business by the Financial Crime Investigation Service (FCIS). The legal framework is regulated by the Money Laundering Prevention Act. The government regulates cryptocurrencies in Lithuania within the Fifth EU Anti-Money Laundering Directive (AMLD 5). The Central Bank of Lithuania launched its first digital currency LBCOIN in early 2020. As a consequence, the country has become more cryptocurrency-friendly than ever before, with more banks offering cryptoaccounts in Lithuania.
Launching a crypto startup in Georgia is one of the inexpensive solutions if we consider European countries. This state is on the list of countries that are being considered for cryptocompany registration in Europe. The government has developed a favourable tax policy for such companies; among other things, sale/exchange of cryptocurrencies is not subject to VAT. There are a number of banks in this country that cooperate with crypto projects. But before opening an account for crypto activities in Georgia, please note that cooperation of local banks with persons whose activities are related to virtual currency is limited only to exchange, purchase and sale of cryptocurrencies.
Opening an account for crypto activities in a payment system is another affordable option for owners of cryptocurrency companies. Each payment system, like a regular bank, has a number of individual conditions and requirements, including a list of jurisdictions with which it does not work. We cannot absolutely guarantee opening of an account for crypto activities, but our specialists are ready to help reduce the risks of failure to a minimum, and we will take care of all the organizational aspects of this process.
As we can see, although many countries are developing a clear regulatory framework for regulation of cryptocurrencies, only a few banks are willing to work with such companies. IB-IA Group UAB specialists provide support in opening an account in European banks for cryptocurrency companies and will be happy to provide you with the full range of services you need.