Obtaining a Crypto License in El Salvador

• Bitcoin is officially recognized as a state currency.

• There are no established minimum requirements for the amount of insurance capital.

• It is allowed to invest in cryptocurrency business and receive income in bitcoins.

• The government is seeking to attract foreign investors.

• The process of obtaining a license for crypto activities in El Salvador is quite simple and transparent.

• The sale of Bitcoin is exempt from capital gains tax.

• By investing in Bitcoin or USDT you can get a residence permit.

• The costs of obtaining a crypto license and subsequent company operations are low.

• Bitcoin Activity License (BSP License). This license is mandatory for companies working with Bitcoin. It covers various activities such as exchanging Bitcoin for traditional currencies (fiat), processing payments, and storing crypto assets. The license is issued by the Central Bank of El Salvador (BCR). 

• Digital Asset Services License (DASP License). This license is intended for companies that deal with various types of digital assets, excluding Bitcoin. The license is issued by the National Commission on Digital Assets (CNAD). All companies operating in this area are required to comply with the established regulations.
   

The main government body responsible for regulating cryptocurrency-related activities in the country is the ESSCC (Securities and Cryptocurrency Commission). This organization controls the functioning of all crypto companies in the country. The main task of the regulator is to ensure the safety and legality of entrepreneurs planning to create a crypto structure in the state.

ESSCC develops regulatory standards for cryptocurrency businesses, facilitating a transparent licensing process. In cooperation with various government control, monitoring and supervision bodies, the regulator also works to prevent financial crimes.

To obtain a DASP license, a company must have a transparent structure, disclosing information about its management, including key individuals mentioned in the documentation. These requirements help regulate the activities of companies and protect the rights of investors. In addition, crypto license holders in El Salvador are required to implement effective risk management systems and follow AML (anti-money laundering) and KYC (know your customer) standards to protect the market from illegal activities.

The DASP license comes with a strict reporting obligation to regulators, requiring regular reports on the companies’ activities and financial position. These measures help ensure market security and prevent financial crime. It is also important to note the need to maintain high cybersecurity standards to protect clients’ digital assets from potential cyber threats.

• The BSP License is required for companies that work with Bitcoin and is provided by the Central Bank of El Salvador (BCR). t is also required for operations related to the exchange, custody of crypto assets, and processing of payments in BTC. To obtain the license, companies must comply with AML and KYC requirements, appoint a compliance officer who is a resident of the country, and ensure adherence to cybersecurity standards.

• DASP licenses regulate the activities of companies working with digital assets, with the exception of Bitcoin, which does not fall into this category. Licensing is carried out by the CNAD, and this crypto license covers a wide range of services related to cryptocurrencies, including issuing tokens, trading, storing digital assets, and creating investment products based on cryptocurrency. Having a DASP license allows companies to legally provide such services while complying with all regulatory requirements.

Fill out the pre-registration form on the CNAD website , and indicate all information about the company and type of activity. Then comes the initial assessment of the regulator, secondary and a decision is issued.

To ensure a positive outcome, you should trust experienced professionals in this matter, but fortunately, you have the Law & Trust team .

DAPS license requirements 

• Full transparency of information about the representative and the company.

• A business plan must be provided.

• A set of internal documentation, including AML/CFT policies, a cybersecurity plan, Due Diligence procedures, and a company code of ethics.

• List the digital assets planned for release.

• It will also be required to provide additional documents such as the company's tax identification number ( NIT ), list of shareholders and certification of the identity of the beneficiaries.

To obtain a BSP license in El Salvador, companies must follow strict rules that ensure high standards of business practices and protect the interests of their clients. The main principles include:

1. Fair Business Practices: The Company shall act with integrity and professionalism and with high ethical standards.

2. Customer Care: The interests of all customers must be taken into account and interactions must be transparent, understandable and not misleading.

3. Sufficient resources: The company must have the necessary financial and non-financial resources to provide quality services.

4. Effective Management: Ensuring effective direction and control over the company's activities, including risk management.

5. Protection of Client Assets: The Company shall ensure the safety of clients' assets and funds.

6. Corporate Compliance and Security: Commitment to corporate governance and information security standards is required.

• Consent of the governing body.

• Description of the business plan.

• A document that specifies all the terms and conditions for the provision of services, including the cost and procedure for conversion.

• A statement signed by a legal representative of the company stating that the company complies with all local legal requirements.

• Required internal documents and company policies.

To obtain a permit in El Salvador for crypto activities, it is necessary to go through a multi-stage process of filing documents and verification by the Superintendency, where the data provided is carefully analyzed.

One of the key reasons why cryptocurrency companies seek to obtain licenses in El Salvador is its favorable tax policy for digital asset transactions.

Unlike many countries where income from trading digital assets is subject to taxation, El Salvador has incentives that make doing business here far more attractive. This is especially important for companies involved in trading and large investment projects. El Salvador currently imposes zero tax on profits from Bitcoin and altcoin transactions carried out in licensed operations.

However, the country’s standard corporate income tax (CIT) rate is 30% and applies to income from traditional activities. The tax exemption for crypto firms represents a significant advantage for exchanges, investment funds, and private traders, allowing them to keep most of their profits within their structure.