Through an announcement made on 14th February, the Central Bank of Lithuania notified that they are updating their position around cryptocurrencies and ICOs. They provided a better definition for digital assets and also established the conditions for crypto-based businesses.
The official announcement says:
“Taking into account current market developments and evolving regulatory regimes as well as seeking to ensure a level playing field for all financial market participants, the Board of the Bank of Lithuania has updated its position on virtual assets and initial coin offering. The position is intended for existing and potential financial market participants as well as entities intending to organize initial coin offerings or provide the possibility for Lithuanian investors to invest in this product type.”
What’s notable about this updated position is that the term ‘virtual currency’ has been replaced by ‘virtual assets.’ This was to make clear of the fact that virtual assets can be used as currency too, which was not evident in their previous policy which was made way back in 2014.
The central bank went on to emphasize that their position still remains unchanged which is:
“Financial market participants should not participate in activities or provide services associated with virtual assets; they should also ensure separation of their activities from activities associated with virtual assets.”
However, third-party services are still permitted. The new position permits the formation of investment funds intended for professional investors that would invest in virtual assets. Holding of virtual assets for the purposes of using the technology is not considered to be virtual assets related activities or services. FMPs may hold a small number of virtual assets for the purposes of using blockchain technology in their activities; nevertheless, the provision of services to customers should be expressly separated from virtual assets.
Additionally, an equity ICO can be made via crowdfunding platforms. In cases where security tokens are issued through a crowdfunding platform, the requirements for such activity provided in the Republic of Lithuania Law on Crowdfunding and the Republic of Lithuania Law on Securities shall apply.
This is the second big news for cryptocurrencies coming out of Lithuania today. Earlier we reported that the cryptocurrency wallet provider Blockchain.com has opened a new office located in Lithuania. This is the fifth office that the company opened around the world and it is also part of its expansion plans in Europe. The firm informed that the country is truly committed to innovation and it was the perfect place to open one of its offices. At the moment, the firm is searching for new employees in the country and vacancies will be announced in the coming weeks.