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Overview
In Cyprus, obtaining a crypto license involves registering a company and adhering to the regulations set by the Cyprus Securities and Exchange Commission (CySEC). The application process requires submitting a detailed business plan, AML/KYC policies, risk management procedures, and information about the company’s directors and shareholders. CySEC evaluates the application to ensure that the business meets financial stability, regulatory compliance, and governance standards. Once the license is approved, the company can legally offer cryptocurrency-related services such as trading, exchange, and custody within Cyprus. Ongoing compliance with CySEC regulations, including regular reporting, audits, and adherence to AML/KYC protocols, is essential for maintaining the license. Engaging with legal and financial advisors experienced in Cypriot financial regulations can help streamline the licensing process and ensure full compliance.
Timeframe: 7 months
Minimum paid up capital: The share capital required depends on the type of license:
- ▪Type 1: EUR 50,000
- ▪Type 2: EUR 125,000
- ▪Type 3: EUR 150,000
Overview
To operate in cryptocurrencies, businesses in Cyprus must obtain a license from CySEC. While the licensing process can be challenging, it offers significant benefits.
CySEC provides a clear regulatory framework and has extensive experience overseeing crypto companies. Cyprus features a robust ecosystem with crypto communities, traders, financiers, and accessible banking for licensed companies, complemented by favorable taxation.
Comprehensive Guide to Company Incorporation
General information
Company structure
- ▪A minimum of one shareholder is required, and this can be either an individual or a corporate entity.
- ▪At least four directors are needed, two of whom must be executive directors. CySEC must approve these directors based on their qualifications and experience.
Confidentiality
- ▪Beneficial owners’ details – disclosed to the Authorities
- ▪Shareholders’ details – part of public record
- Directors’ details – part of public record
Taxation
The corporate tax rate in Cyprus is 12.5%. There are no additional taxes specifically for cryptocurrency businesses.
Accounting requirements
- ▪Filing annual report is obligatory
Secretary – Required
Registered office – A physical office in Cyprus is mandatory to ensure the business is managed locally and complies with CySEC regulations.
Local employees: While there is no strict number for local employees, hiring local staff, especially for compliance roles such as an AML officer, is essential.