Why Lithuanian cryptocurrency license is more profitable than Estonian license
Lithuania is one of the few countries where you can get a cryptocurrency license. There are clear rules that regulate the exchange of digital currency, which guarantees reliability and fairness of transactions. Not only that, many experts believe that cryptocurrency license in Lithuania is more beneficial than Estonian license.
Lithuanian and Estonian licenses: comparison
There are 2 types of licenses available in Lithuania that provide such opportunities:
- Exchange cryptocurrency for fiat money - a company can exchange tokens, earning a commission.
- Create a virtual wallet where cryptocurrency can be stored.
- The company can get either one or two licenses. Their issuance is supervised by the Financial Crimes Investigation Service (FCIS), which is a division of the central bank.
- Application for a cryptolicense in Lithuania in 2022 is considered for a month.
Unlike Lithuania, Estonia issues one cryptocurrency license, which allows exchanging digital currency and providing wallets to store it. But it loses out to Lithuania in the price of the license and the processing time. Permits in Estonia are issued by a special Financial Intelligence Unit, which deals with licensing cryptocurrencies.
Where to register a company: Lithuania or Estonia
To get a cryptocurrency license, you first need to register a company. In Lithuania, it is easier to take permission.
Both countries require a director with a good business reputation. According to Estonian law, there must be a local resident among the directors of the company, Lithuania, however, has no such requirement. He/She can be a non-resident.
Lithuania does not require a physical office in the country, except for the cases when it is necessary to get a VAT number. The headquarters of the company may be abroad.
If you want an Estonian license, the head office must be located in the country. In other words, foreign companies may operate in Estonia through a branch that is registered in the commercial register and has its headquarters in Estonia.
It is cheaper to register a cryptocurrency company in Lithuania than in Estonia. The amount of the authorized capital is 2.5 thousand euros compared to 12 thousand euros.
Non-criminal record requirements
Estonia requires a certificate of criminal record for all company owners. In Lithuania, this requirement is not necessary if the shareholders and directors are not involved in fraud, and are not on the blacklist.
Corporate tax in Lithuania is 15%, but for companies whose turnover does not exceed 300 thousand euros and the number of employees does not exceed 10, there is a preferential rate of 5%.
Corporate tax in Estonia has its own specifics. 20% is paid only after the distribution of dividends (royalties, interest). Until this happens, there is no need to pay.
If you decide to hire employees in the country where the company is registered, it is more profitable to do it in Lithuania. Employment costs are 15% lower than in Estonia, given the latest social tax contributions and the average wage in the financial sector.
Lithuania or Estonia: which to choose
If you want to open a cryptocurrency business in Lithuania or Estonia in 2022 and are wondering which country to choose, contact at IT-OFFSHORE and we will explain all the nuances.