Lithuania Attempts to Go the Extra Mile, Ready to Implement Rigorous Crypto Regulations
One of the Baltic states, Lithuania, will be implementing strict cryptocurrency regulations in order to have control over the activities that take place in the market.
The government in Vilnius is currently working on a regulatory framework that will go even further than what the European Union (EU) Anti-Money Laundering Directive requested.
Lithuania to Implement Strict Crypto Regulations
There are several countries around the world that are trying to regulate virtual currencies and blockchain technology. Lithuania will be one of the first countries in Europe to be implementing regulations in order to be compliant with the requirements established by the EU Anti-Money Laundering Directive. This shows that there is a real effort in the country to control the whole crypto market and the activities that are being developed around them.
Entities registered with the country’s Center of Registers will be able to operate with virtual currencies in the country. These companies will need to adopt strict know your customer (KYC) and anti-money laundering procedures. Large transfers will also have to be informed to the Financial Crime Investigation Service (FCIS).
Firms that will be working in the market will have to make sure that the deals processed through their platforms are compliant with the law in Lithuania and do not break the current framework on the prevention of money laundering and terrorist financing. With KYC policies, users will have to provide all their private information if they want to have access to services in the market.
As reported by news.Bitcoin.com, Sigitas Mitkus, the director of the Finance Ministry’s Financial Market Policy Department, explained about the new regulations:
“We want to create a transparent legal environment for virtual currency exchanges, depository wallet operators and ICO initiators. We also want to contribute to ensuring better consumer protection.”
Additionally, he added that they will probably be the first country in the world that will be implementing the FATF (Financial Action Task Force) recommendations. The G-20 summit that took place in Argentina in 2018 agreed to regulate the crypto space by following FATF standards to fight against money laundering and tax evasion.
Bankera, a company located in Lithuania that aims at offering an online bank with crypto-backed loans, could be affected by the decisions that will be implemented by the government. According to Vytautas Karalevičius, the founder of the firm, these new regulations will have a deep effect on the startup.
Although it could be a challenge for the company to be compliant with the new rules, it is worth mentioning that they have been dealing with KYC and AML procedures even before they were required. During a conversation with news.Bitcoin.com, Mr. Karalevičius said that a stable regulatory framework and environment in the country is very important for the success of their business.
Due to the fact that there was not a clear regulation and legal framework in the country, several companies decided to settle their operations in other countries with better and improved regulations.