The Markets in Crypto-Assets Regulation (MiCA) introduces a unified regulatory framework for crypto-assets across the European Union (EU), promoting legal certainty, investor protection, and market stability. One of the core requirements under MiCA is obtaining a Crypto-Asset Service Provider (CASP) license, mandatory for businesses offering crypto asset services.
This licensing ensures compliance with strict standards on governance, security, and anti-money laundering (AML), enabling licensed CASPs to operate seamlessly across all EU member states. Whether you are an emerging startup or an established operator, obtaining a CASP license is essential to access the EU’s vast and dynamic market for digital assets.
In Estonia, the Financial Supervisory Authority (Finantsinspektsioon / FSA) is the competent authority overseeing CASP licensing under MiCA. Businesses operating or planning to provide crypto-asset services in Estonia must adhere to local implementation requirements alongside MiCA’s EU-wide provisions.
Our firm has a thorough knowledge of Estonian law, ensuring that your compliance efforts are efficient and effective.
We can help your business meet compliance requirements and unlock the potential of the EU crypto market!
In Estonia, the FSA is the competent authority overseeing CASP licensing under MiCA
Key Numbers about a CASP License in Estonia
3 mountsaverage term of obtaining CASP license after application submission |
at least severaldirectors in a CASP |
up to €150kamount of the share capital depending from CASP activity |
22%personal income tax (PIT) rate |
22%corporate income tax (CIT) rate |
22%capital gains tax (CGT) rate |
Legal Opinion about a CASP License in Estonia
Ganna Voievodina
Manimama
|
CEO
“Obtaining a CASP license in Estonia is essential for businesses offering crypto-asset services. Applicants must meet requirements, including robust AML/CFT compliance, a formal governance structure, and sufficient operational capital. Once licensed, CASPs must adhere to ongoing reporting obligations and maintain compliance with Estonian and EU regulations. Do not hesitate to contact Manimama Law Firm if you want to go through the process of getting the license quickly and easily”.
Types of Activities with a CASP License in Estonia
Providing custody and administration of crypto-assets on behalf of clients
This service means safekeeping or controlling, on behalf of third parties, crypto-assets or the means of access to such crypto-assets, where applicable in the form of private cryptographic keys. Holdings of crypto-assets on behalf of the clients shall be segregated from CASP’s holdings.
Operation of a trading platform for crypto-assets
This service contains of the management of one or more multilateral systems, which brings together or facilitates the bringing together of multiple third-party buying and selling interests for crypto-assets – in the system and in accordance with its rules – in a way that results in a contract, either by exchanging one crypto-asset for another, or a crypto-asset for funds.
Exchange of crypto-assets for funds
This service means the conclusion of purchase or sale contracts concerning crypto-assets with clients for funds by using proprietary capital.
Exchange of crypto-assets for other crypto-assets
This service means the conclusion of purchase or sale contracts concerning crypto-assets with clients for other crypto-assets by using proprietary capital.
Execution of orders for crypto-assets on behalf of clients
This service means concluding agreements to buy or to sell one or more crypto-assets or to subscribe for one or more crypto-assets on behalf of third parties and includes the conclusion of agreements to sell crypto-assets at the moment of their issuance.
Placing of crypto-assets
This service includes the marketing, on behalf of or for the account of the offeror or of a party related to the offeror, of crypto-assets to purchasers. Before placing the crypto-assets a CASP shall obtain the agreement of the issuers or any third party acting on their behalf.
Reception and transmission of orders for crypto-assets on behalf of clients
This service means the reception from a person of an order to buy or to sell one or more crypto-assets or to subscribe for one or more crypto-assets and the transmission of that order to a third party for execution.
Providing advice on crypto-assets
This service means offering, giving or agreeing to give personalized recommendations to a third party, either at the third party’s request or on the initiative of the a CASP providing the advice, in respect of one or more transactions relating to crypto-assets, or the use of crypto-asset services.
Providing portfolio management on crypto-assets
This service includes managing portfolios in accordance with mandates given by clients on a discretionary client-by-client basis where such portfolios include one or more crypto-assets.
Providing transfer services for crypto-assets on behalf of clients
This service means transfer, on behalf of a natural or legal person, crypto-assets from one distributed ledger address or account to another. Such service may be provided without virtual currency wallet opened for a CASP’s client.
Benefits of Obtaining a CASP License in Estonia
Regulatory legitimacy:
- The CASP license guarantees compliance with Estonian law, providing legal certainty and protection for your business.
- The license status increases the credibility of your company among investors, clients, and financial partners.
Access to the European market:
- Estonia is an EU member, and a CASP license facilitates cross-border operations within the EEA.
- Passporting rights allow licensed entities to expand their services to other EU countries without the need for additional licensing.
Tax advantages:
- Estonia’s unique corporate tax system allows companies to reinvest profits without immediate tax liabilities.
- Crypto companies can benefit from low tax burdens on distributed earnings and operational income.
Enhanced credibility:
- Holding a CASP license demonstrates commitment to regulatory standards, improving your reputation among global customers and institutional clients.
- It positions your business as a reliable and compliant player in the rapidly growing crypto industry.
Advanced digital infrastructure:
- Estonia is a global leader in e-Governance, offering robust digital tools like e-Residency, e-Banking, and online business registration.
- Licensed businesses can efficiently manage operations using the nation’s state-of-the-art digital ecosystem.
Customer protection measures:
- Licensed CASPs must adhere to policies that safeguard customer funds and data.
- This helps prevent fraud and builds a long-term loyal client base.
Our Services
STEP 1
Incorporation stage
- Company formation in Estonia
- Provision of a registered address for 1 year
- Opening corporate bank account and transferring the share capital
- Appointment and employment of a local director
- Detailed company structure documentation
STEP 2
Pre-licensing stage
- Preparation and submission legal and financial documents (non-exhaustive list) according to MiCA
- Review of existing policies and procedures, if the company already has them
STEP 3
Licensing stage
- CASP license application assistance
- Conducting communication with the FSC during the license process
Our Experts in this Area
Step by Step Description
-
Initial setup
- Initiating a preliminary project assessment
- Creating an action plan
- Preparation and filing of the package of documents
-
Company registration
- Selection and verification of the company name
- Registration of the company in the e-Business Register either online using an E-resident card, by Power of Attorney or in person at a notary’s office
- Payment of state fees
- Opening a bank account
-
Obtaining a CASP license
- Preparation of documents according to MICA
- Submission an application to the licensing authority - FSC
- Reviewing the application to ensure it is complete (if any documents or information are missing, the applicant will be notified and given a specific deadline to provide the necessary additional documentation)
- Assessment of the documents` content submitted (a detailed review to verify that all regulatory requirements are met)
- Requesting of additional details (if applicable)
- Notification of grant or refusal of the CASP license
- Granting or refusal notification to European Securities and Markets Authority (ESMA)
- Publication in ESMA register
Estonian National Legislation
In Estonia, the transition period means that applicants may continue to provide services related to the provision of virtual currency by July 1, 2026
Regulation:
Estonia has enacted the Crypto-Assets Market Act (Krüptovarade turu seadus / KrüTS) to implement the provisions of the MiCA regulation. This act, effective from July 1, 2024, aligns national legislation with the EU's MiCA framework, establishing comprehensive rules for CASPs operating within Estonia.
Licensing authority:
In Estonia, the regulatory authority overseeing the licensing of CASPs under the MiCA framework is the Financial Supervision and Resolution Authority (Finantsinspektsioon). This agency is responsible for financial services market regulation and supervision, including the authorization and oversight of CASPs.
Procedure, timelines, fees:
Following the full application of MiCA, i.e. after 30 December 2024, the FSA must assess within 25 working days of receiving an application for authorisation whether all of the required information has been included in the application. At this stage, however, the FSA will not assess the quality of the information provided. The FSA may ask the applicant to supplement the application if some or all of the required information is missing. The FSA will set a deadline for the submission of any missing information. After the submission of missing information, the FSA will have 40 working days to make a qualitative assessment of the application. During this period, the FSA has the opportunity to submit additional requests for clarification, but only the first of these requests will suspend the 40 working day assessment period, for a maximum of 20 working days.
The application must be filed in Estonian. If the applicant intends to submit documents in English, this must be clearly stated in the application.
The processing fee payable when applying for CASP license is €3,000.
Transition period:
The virtual currency service provider and any other person who, prior to the entry into force of the Cryptocurrency Market Law, is authorized to provide virtual currency services, shall bring its activities into compliance with the requirements set forth in this Law no later than July 1, 2026.
If the above-mentioned provider has applied for authorization to the FSA before July 1, 2026 and the regulator has not made a decision to grant or deny authorization before that date, the activities of the virtual currency service provider will not be considered unauthorized activities. In such a case, the provider is not allowed to enter into new contracts with customers from that date until the decision to grant or deny authorization is made.
Requirements for Obtaining a CASP License in Estonia
Capital requirements for a CASP vary depending on what services the company will provide - from €50,000 to €150,000
Physical office requirements
A CASP shall have a registered office in Estonia where it carries out at least part of their crypto-asset services.
Requirements for key persons
-
Senior managers (directors):
- Number: MICA does not specify a minimum and maximum number of directors. However, MICA states (part 2, article 59) that there shall be at least several directors.
- Residency requirements: At least one director must be an EU resident.
- General requirements: Directories must have a solid reputation, necessary skills, and relevant experience.
- Required documents:
- a clean criminal record;
- a detailed CV;
- statements on time commitment and past professional conduct.
-
Shareholders:
- Number: MICA does not specify a minimum and maximum number of shareholders.
- Residency requirements: There is no restriction.
- General requirements: Shareholders must have a solid reputation, necessary skills, and relevant experience.
- Required documents:
- a clean criminal record;
- an ownership structure chart.
Capital requirements
Capital requirements vary depending on what services the company will provide:
Class 1: A CASP authorized for the following crypto-asset services:
- execution of orders on behalf of clients;
- placing of crypto-assets;
- providing transfer services for crypto-assets on behalf of clients;
- reception and transmission of orders for crypto-assets on behalf of clients;
- providing advice on crypto-assets; and/or
- providing portfolio management on crypto-assets.
Minimum capital requirements - €50,000.
Class 2: A CASP authorized for any crypto-asset services under Class 1 and:
- providing custody and administration of crypto-assets on behalf of clients;
- exchange of crypto-assets for funds; and/or
- exchange of crypto-assets for other crypto-assets.
Minimum capital requirements - €125,000.
Class 3: A CASP authorized for any crypto-asset services under Class 2 and:
- operation of a trading platform for crypto-assets.
Minimum capital requirements - €150,000.
Documentation requirements
There are list of documents that must be submitted with the application:
-
Documents required for all CASPs:
- The articles of association of the applicant CASP
- Identity and proof of good repute, knowledge, skills, experience and of sufficient time commitment of the members of the management body
- Information relating to shareholders or members with qualifying holdings
- A program of operations setting out the types of crypto-asset services that the applicant CASP wishes to provide, including where and how these services are to be marketed
- A description of the applicant CASP’s prudential safeguards (insurance policy)
- A description of the applicant CASP’s governance arrangements and internal control mechanisms
- A description of the applicant CASP’s business continuity plan
- Detection and prevention of money laundering and terrorist financing (full packet of policies)
- Descriptions both in technical and non-technical language of applicant CASP’s IT systems and security arrangements
- A description of the applicant CASP’s procedures to handle complaints from clients
- Documents required in case CASP wishes to offer services in other countries:
- List of EU countries where the company wishes to offer its services
- Documents required for certain services (each of the 10 services requires its own documents):
- Custody and administration policy
- A description of the procedure for the segregation of client’s crypto-assets and fund
- The operating rules of the trading platform and market abuse detection
- Information on the exchange of crypto-assets for funds or other crypto-assets (commercial policy)
- The execution policy
- Information on the provision of advice or portfolio management on crypto-assets
- Information on transfer services
Taxes in Estonia
Income earned by Estonian companies is tax-free (0% CIT) as long as it is not distributed (i.e. paid either as salaries or dividends)
Corporate Income Tax (CIT)
Estonia has one of the most favorable corporate tax rates among the so-called offshore jurisdictions and non-tax havens.
Cryptocurrency is property as defined in the Income Tax Act of Estonia.
Income received in cryptocurrency (for example, gains from the business income) is taxed on a similar basis as income received in traditional currency.
Income tax is levied on profits from the transfer of crypto-assets, including their exchange. Only those transactions that generate income are required to be declared. For property taxation, each transfer transaction, including exchange, is treated as a separate object of taxation.
In general, income earned by Estonian companies is tax-free (0%) as long as it is not distributed (i.e. paid either as salaries or dividends).
As of January 1, 2025, the CIT rate is 22%.
Capital Gains Tax (CGT)
There is no special tax on capital gains in Estonia. Therefore, cryptocurrency profits are treated as ordinary income and taxed at a flat rate of 22% (22/78 on the net amount of the profit distribution).
Personal Income Tax (PIT)
The PIT rate is 22%.
The amount of basic exemption depends on a person’s income (up to €654 per month and up to €7,848 per year). In order for the basic exemption to be calculated, the person must submit a written application to the employer or the person making the payment.
Frequently Asked Questions
-
What is a CASP license in Estonia?The CASP license allows companies to legally offer crypto asset services in Estonia.
-
Who issues the CASP license in Estonia?The FSA is a responsible authority for granting CASP licenses.
-
Why is a CASP license required in Estonia?A CASP license ensures compliance with Estonian and EU regulations. It aims to protect consumers, combat financial crimes like money laundering, and promote transparency in the crypto industry.
-
What services can be provided under a CASP license?
It allows services such as:
- 1) Providing custody and administration of crypto-assets on behalf of clients
- 2) Operation of a trading platform for crypto-assets
- 3) Exchange of crypto-assets for funds
- 4) Exchange of crypto-assets for other crypto-assets
- 5) Execution of orders for crypto-assets on behalf of clients
- 6) Placing of crypto-assets
- 7) Reception and transmission of orders for crypto-assets on behalf of clients
- 8) Providing advice on crypto-assets
- 9) Providing portfolio management on crypto-assets
- 10) Providing transfer services for crypto-assets on behalf of clients
-
What are the key requirements to obtain a CASP license in Estonia?Companies must meet physical office requirements, requirements for managers and shareholders, minimum capital requirements, documentation requirements.
-
Is it mandatory to have a physical office in Estonia to obtain a CASP license?Yes, a local office in Estonia is required for regulatory oversight.
-
Is there a minimum capital requirement for obtaining a CASP license?Yes, applicants must meet specific financial and operational adequacy standards, but the exact minimum capital depends on the services offered (€50,000, €125,000, €150,000).
-
What is the process for applying for a CASP license?The process involves submitting an application to FSA with detailed documentation on the company structure, management, AML policies, and financial plans, etc.
-
How long does it take to obtain a CASP license?The preparation of documents and the review process typically takes several months, depending on the completeness of the application and the authority's workload.
-
Is the CASP license recognized in other countries?Yes, the Estonian CASP license is recognized across the EU under the principle of passporting, enabling licensed entities to offer their services in other EU member states without additional licensing.
-
What is the cost of obtaining a CASP license in Estonia?Costs include registration fees and ongoing compliance expenses. Specific figures depend on the size and scope of the business.
Наші останні юридичні дослідження
Сompany registration in Wyoming (USA): Legal aspects and advice
February / 28 / 2025
|
15 m. to read
Go To News
Company registration in Hong Kong: Legal aspects and advice
February / 27 / 2025
|
15 m. to read
Go To News
Top 3 Strangest Lawsuits in History
February / 26 / 2025
|
15 m. to read
Go To News
Legal Vocabulary: breaking down the complex with a pinch of humor
February / 25 / 2025
|
15 m. to read
Go To News
How Due Diligence Helps Identify Risks in Crypto and Blockchain Projects – Part 2
February / 25 / 2025
|
15 m. to read
Go To News
