Opening a Cryptocurrency Exchange in Estonia
Estonia is the best place right now to open a cryptocurrency exchange, especially if you don’t require local banking. You don’t get called the European Silicon Valley for nothing. Estonia’s legal framework regarding financial technology companies and its position as part of the European Union make it a great bet for opening a business involving the trade of virtual currencies.
All residents of Estonia have access to information and online services, they can use their digital identities to do business and update or correct their data in state registries. More than 90 percent of Estonians have an electronic identity card with which they can access the services of the States and travel through the European Union.
The major event that cemented Estonia, and possibly the example that developed countries will follow in order to compete in the financial technology sector, was the implementation of the e-residency program. The massive success of the e-residency program made the Northern European country rely on technology based projects to advance its economy.
The e-residency program allows any citizen who qualifies to become an online citizen of Estonia and to open a business inside of the country without leaving your office or house. Then, these businesses can be “passported” throughout the European Union. The program has allowed for many international investment companies to expand their business to the EU.
The inauguration of the e-residency program coincided with a legislation passed by the countries highest tax regulator in which they acknowledge Bitcoin as a decentralized virtual currency. This allowed for Bitcoin to be considered legally as an alternative means of payment. The legislation was one of the first guidelines drawn that made Estonia’s views on the promise of virtual currency clear.
Opening a cryptocurrency exchange platform in Estonia will not only be a secure investment because of its geographical position and low taxes compared to the rest of the European Union, but also because you will obtain a great deal of support from the government. The Estonian government is investing in technology and making it easy for anyone who wants to start operating in the financial technology market. Let’s start by explaining the steps to starting your own cryptocurrency exchange company.
Before opening a cryptocurrency exchange you will have to have a registered business in Estonia. The e-residency will be of substantial help in this matter as you can register online. Your first step will be choosing and securing a business name that has to be verified by the corresponding authorities. After the company name has been accepted you must register to obtain a licence and record all employees your company will have.
Once your business is fully operating and running you will have to apply for a licence for a cryptocurrency exchange. When applying for a licence for a business involving virtual currency there are two that you can apply for. The first licence states that your business will provide a service of exchanging a virtual currency against a fiat currency and the second licence is applicable only if you will provide a virtual currency wallet service. If your company does both, you will have to apply for both licences separately.
Licences are issued by the Estonian Financial Intelligence Unit, which is a branch of the Estonian Police Department. Even though the company is qualified to function as a financial institution, all matters involving taxes will be settled with the same office that regulates all other companies and in the exact same way.
It usually takes about 1 or 2 business days for all of the process of creating a company to be completed, if all necessary information is correctly presented and in person. If you establish your cryptocurrency exchange in Estonia from abroad, it takes about 1 or 2 weeks. Obtaining a licence takes within 30 days.
Registering a company is Estonia is much cheaper than opening one in Switzerland or any other country making headlines in the financial technology field. And doing business in Estonia costs a fraction of the very high priced Switzerland.
Many companies are looking to take advantage of the popularity that virtual currencies are having right now. Starting a cryptocurrency exchange in Estonia is the first step in achieving success. The e-residency program makes your company’s services available to more clients that a cryptocurrency exchange in Switzerland will ever reach.
The undeniable confidence that the citizens and foreigners that decided to invest in Estonia comes from the aforementioned governmental support that the country provides. For that reason only Estonia should be the only country you think about when deciding where to open your cryptocurrency exchange business.
I hope you’ve found this article on Estonia to be helpful. For more information, or for assistance with the Estonian digital residency, investing in Europe, or starting an international cryptocurrency exchange, please contact us HERE. We can offer you a truly turnkey solution with software, license, banking, compliance, KYC, AML, etc.
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