Over Seventy Percent of Estonian cryptocurrencies businesses loses licenses

By: Mark Jessy

December 17, 2020 9:21 PM

Over 70% of Estonian crypto-currencies businesses loses licenses

Estonia has withdrawn permits for over 1000 crypto companies. Estonia having position itself as the go-to country for emerging crypto businesses amongst it's European counterparts has revoked the licenses of over a thousand firms this 2020.

Postimes the first known daily newspaper in Estonia reported that Estonia’s Financial Intelligence Unit (FIU), has revoked the licenses of roughly 70% of virtual currency companies operating in the country this year. Veiko Tali, the Deputy Secretary General of the Government Committee for the Prevention of Money Laundering and Terrorist Financing, said the remaining crypto firms also required “close attention” given the potential risks:

"We need to monitor the development of new technologies and manage the associated money laundering risks."

Postimes also stated that there are 400 crypto-related service providers remaining with the appropriate licenses in Estonia following the purge. The financial watchdog reported that 900 such firms operated in the country last year.

A major crackdown occurred in June, when the FIU revoked the licenses of 500 crypto firms in response to a $220 billion money laundering scandal in Estonia. Regulators withdrew the permits as the crypto companies had failed to start operations within six months of being licensed.

At the time, FIU head Madis Reimand called the financial watchdog’s actions the “first step in tidying up the market.”

Before now, the country was seen by many as a crypto trailblazer with a series of laws seemingly intended to encourage exchanges and ICOs mainly in 2017. However, the regulatory landscape in Estonia has since changed, and goes beyond the requirements of the EU’s 2019 Know Your Customer laws, making the path for licensed crypto firms attempting to comply with local regulations more difficult.