From November 1, 2022, in connection with the law adopted in Lithuania, innovations related to the legal regulation of virtual currencies will come into force.

According to Lithuanian sources, from November 1, virtual currency exchange operators and depository currency wallet operators will be prohibited from opening anonymous or fictitious accounts. Including it will be impossible to register accounts without providing reliable information about yourself. The following concept of virtual currency will also be introduced (presented below):

“Virtual currency is an instrument that has a digital value, but does not have the legal status of a currency or money, that is not authorized or guaranteed by a central bank or other government agency, and that is not necessarily associated with a currency, but is recognized by individuals or legal entities as a means of exchange and may be transferred, stored, sold, exchanged, invested and used for settlements by electronic means.

What will these changes bring now?

– Joint stock companies – established in Lithuania for the purpose of carrying out the activities of digital currency exchange operators or operators depositary currency wallets must now have a share capital of 125,000 euros. 

– As for other legal entities established in Lithuania or branches of legal entities of the EU Member States, in order to carry out this activity, they must have a performance guarantee issued by an insurance company or a financial institution in the amount of 100,000 euros and covering damage in the amount of 500,000 euros for all consumer requirements per year.

- A requirement is introduced for the director (manager) of a company - now only a resident of Lithuania can be a director of such a company.

— In particular, now each operator of the virtual currency exchange and / or operator of the depositary virtual currency wallet must have unique personnel (it is impossible for the same personnel to represent two or more operators), except for cases when the operators are part of a holding.

— The operator of the virtual currency exchange and/or the operator of the depositary virtual currency wallet should not provide their services outside of Lithuania.

Thus, all existing and newly created cryptocurrency operators in Lithuania will require at least:

  • director-resident of Lithuania with the only place of work in this company;
  • AML officer - a resident of Lithuania with the only place of work in this company;
  • bank guarantee or authorized capital.

Including all legal entities established in Lithuania and branches of legal entities of the EU Member States or foreign states that have begun to operate as virtual currency exchange operators and/or depository virtual currency wallet operators must be brought into compliance with this law no later than December 31 2022. Accordingly, now they need to change the authorized capital if it is less than 125,000 euros and purchase a performance guarantee, if necessary.

For more detailed advice, you can contact our experts. Law&Trust International specialists constantly monitor changes in the legislation of various countries. We can provide you with full legal support for business in Lithuania and other jurisdictions. Give recommendations in which countries it is better to work with virtual currency, in particular with cryptocurrency.