The above mentioned products are used only for clear understanding. We don't have control of the brand and are not doing direct & indirect partnerships with them. We are also not doing promoting activities for them.

cryptocurrency

A Comprehensive Guide On How To Get A Crypto License In Cyprus

Share:
...

Cyprus, which stretches deep into the Mediterranean Sea and offshore from mainland Europe, is usually regarded as one of the greatest spots in Europe for starting and operating a cryptocurrency trading firm. More specifically, Limassol, a city on the island's southern coast, is frequently regarded as a financial hub - not only of Cyprus but of the whole Mediterranean area. Maybe this is one of the reasons why numerous businesses have started to invest in crypto exchange development and launch a business of their own. Limassol's financial area is home to the branch offices of several major cryptocurrency companies, including Coinbase and Bitpanda.

 

Why Should You Obtain A Cryptocurrency License In Cyprus?

 

Cyprus is attractive among financial service companies for a variety of reasons. To begin, it has a precise and established network in regard to law and regulation, allowing service providers to pick among hundreds of licenses for various investment services. Many common licenses are also divided into tiers, permitting case-sensitive requirements and greater application success rates. Cyprus also recognizes and supports a diverse set of financial products, including cryptocurrency derivatives. This adds to the island's highly varied commercial environment. 

 

Finally, Cyprus's taxation structure has lower tax rates than other nations in continental Europe, creating better circumstances for long-term company growth and development. Regulatory organizations also aim to provide favorable circumstances for international investors, who have considerable rights when establishing businesses in the country. Finally, in comparison to other international jurisdictions, Cyprus imposes no limits on bitcoin mining activities.

 

Cryptocurrency License In Cyprus- The Regulatory Framework

 

Companies in Cyprus that conduct money swaps between cryptos or crypto and fiat currencies are classified as Crypto Asset Service Providers (CASPs). Companies must seek authorization from a regulatory agency in order to conduct trading operations involving crypto assets. The Cyprus Securities and Exchange Commission (CySEC) is the regulatory agency in charge of licensing procedures, issuing (or rejecting) CASP applications, and overseeing approved cryptographic asset providers. CASPs are described as those who offer the following services to another person or on behalf of a third party who is not obligated by legal regulations to avoid money laundering:

 

- Trading between fiat (traditional) currencies and cryptocurrencies

 

- Trading involving cryptographic assets

 

-  Control over cryptographic assets, including their transfer, ownership, storage, and use of cryptographic keys or other mechanisms

 

- Cryptographic asset offers and/or sales, including opening bids

 

- Participation in or the rendering of financial services in connection with the sale, supply, or distribution of cryptographic assets (including the original proposal)

 

Legal Prerequisites For Procuring A Cryptocurrency License In Cyprus

 

Applicants must first verify that they satisfy the following fundamental requirements in order to register and be authorized by CySEC. These are:

 

- To have a fully operational office in Cyprus and to hire full-time personnel who are competent and completely capable of performing the company's core duties.

 

- Use explicit and well-defined criteria to ensure high-quality management processes.

 

- Establishment of adequate internal controls required for the seamless functioning and operation of the firm.

 

- Creation of relevant policies and processes in line with the Act and the Directive on the Prevention and Suppression of Money Laundering and Terrorist Financing.

 

- Control and management of a firm in Cyprus. The Board of Directors must include at least four members, and at least two of them must be formally constituted Executive Directors. All CySEC directors must obtain CySEC approval for their expertise and experience in this field. They must also pass CySEC testing.

 

Mandatory Requirements For Setting Up A Financial Services Company In Cyprus

 

Individuals that are planning to provide crypto asset services should be registered as financial service providers in order to apply for a cryptocurrency license. This means starting a firm that meets the following criteria:

 

- Renting/owning & operating in an actual office location, as opposed to a virtual one, is insufficient to get a CASP license

 

- Obtaining and implementing appropriate software, tools, and techniques to ensure compliance with relevant KYC standards

 

- Having a local bank account for the purpose of distributing capital

 

- Hiring corporate management (necessary financial sector expertise is required for senior roles) and a sufficient number of employees

 

- Creating internal rules and procedures in compliance with applicable EU requirements

 

- Developing a clear, complete, and accurate explanation of available capabilities, services, software for money laundering operations and prevention, and disclosure of personal data

 

Establishing A Company In Cyprus- The Complete Process

 

Individuals must fulfill four major procedures in order to create a corporation in Cyprus. The first step is to gather all of the documentation required for the application. These include reports and declarations about the company's nature and registered office space. A capital statement, as well as a Memorandum and Articles of Association, must be included with the application (MAA). Second, the applicant must decide on and submit the company's official name. It must be distinct and distinct from the names of other businesses registered with the Cyprus company registration. Third, the applicant must submit the application to the Cyprus Registrar of Companies. The registrar's decision constitutes the final stage. This sort of application typically takes 5 working days to be processed and results in either acceptance or refusal.

 

Documentation & Paperwork Required For CASP Authorization

 

Applicants must present the following documents in order to properly submit an authorization application:

 

- Application form for CASP

 

- The company's corporate records, including its certificate of formation, certificates for its directors and secretaries, shareholders, address, and memorandum and articles, are all available online.

 

- A manual of internal policies and procedures, a guide to money laundering prevention, and know your client policies

 

- Financial and accounting procedures included in the business plan's marketing strategy.

 

- Information on the capital (quantity, sources, pertinent contracts) demonstrating that the CASP has the cash required by law

 

- Accounting information (forecast information and financial statements where applicable)

 

- Organizational and operational data (such as the first three-year operations plan, organizational structure, and internal processes) demonstrating that the business would operate in its client's best interests and take steps to reduce the danger of loss or foolish behavior.

 

- Internal AML/KYC processes documentation, including customer onboarding procedures

 

- Addresses of all the public keys & wallets for crypto assets that the CASP manages

Information management workflows and operations documentation

 

CySEC may take up to six months to accept or reject an application after the date of filing.

 

Cyprus's Cryptocurrency Tax Rates

 

As briefly mentioned above, Cyprus has lower corporate income tax rates than other nations in Europe. Local government entities recognize cryptocurrencies as taxable assets, making CASPs liable to conventional corporate tax rates. Currently, a 12.5% tax rate is applied to cryptocurrency trading revenue. Expenses incurred in order to generate money from bitcoin trading may be deducted from that income.

 

A group of professionals called Regulated United Europe will assist you in starting a business and obtaining a cryptocurrency license in Cyprus. We assist customers in navigating the administrative side of their businesses by providing legal counsel, ensuring thorough preparation for company and license applications, and working hand in hand with our clients.

 

Conclusion

 

You might have gotten a complete rundown of the steps necessary to obtain a crypto license in Cyprus in 2023 from this article. It is always better to team up with a cryptocurrency exchange development company with a history of building a crypto-based venture on a worldwide scale if the overall process seems tedious to you. These days, you have access to a wide range of businesses that can offer their services at a reasonable price. All you have to do is join forces with an ethical business. It's past time you jumped on the bandwagon since every well-known firm is doing so in one form or another in the cryptocurrency space. Seize this once-in-a-lifetime chance to claim 2023 as your own!

 

Want To Launch Your Own Crypto Exchange Platform In Cyprus?

Get A Free Consultation Here!