Bitcoin Regulation in Estonia - Things You Must Know
If you are a Bitcoin enthusiast, you will find this article very useful. Through this article, we are going to talk about the most important facts you must know about Bitcoin.
Bitcoin Regulation in Estonia
There is no doubt that the Estonian regulations are quite forward-looking in comparison to the cryptocurrency regulations in EU member countries. It's worth mentioning here that cryptocurrencies are not legal tender in Estonia. However, according to the government of Estonia, Bitcoin can be considered as a "digital representation of value". It's also highly significant to make a note here that cryptocurrencies are not subjected to VAT, this shows the government of Estonia is quite open to cryptocurrency. So, it would not be wrong if we say that the taxation policies in Estonia are quite in favour of cryptocurrencies. With the introduction of Anti Money Laundering and Terrorism Finance Act, new regulations for Bitcoin have been brought up in Estonia.
As far as cryptocurrency exchange is concerned, it is legal in Estonia. The Anti Money Laundering and Terrorism Finance Act (which was introduced in 2017 ) has lead Estonia to bring out a supervisory structure for cryptocurrency exchanges. This supervisory framework majorly comprises rules related to reporting as well as KYC rules.
First of all, you should understand that according to the new regulations, for cryptocurrency exchange, you are required to get Virtual Currency Exchange Service License and Virtual Currency Wallet Service License from the Financial Intelligence Unit(FUI).
Submission of Documents
According to the Bitcoin Regulation in Estonia, you'll be required to submit all the documents related to the license via Notary Public or Business Register (for online submission).
Fee For License
As opposed to the 345 EUR that used to be charged a licensing fee for cryptocurrency exchanges, now the amount has been changed to 3300 EUR.
In recent years there have been speculations regarding Estonian government planning likely to introduce their own National cryptocurrency "Estcoin", but the government had to roll back its plan.
Pressure from EU (European Union) authorities and local banks were considered to be the reason for Estonian government to roll back its plans regarding "Estcoin". It is expected that the Estonian government is likely to introduce many more innovative regulations that could make Estonia as the primary stage in cryptocurrencies. In addition to that, it is likely that after the introduction of KYC rules, cryptocurrencies will become safer than before, making it less lucrative for lawbreakers.
No doubt, it is likely that Estonia's innovative ideas will make it more crypto-friendly each passing year.
According to the latest regulations, one will be required to have a payment account in a payment institution of Estonia or an e-payment institution of Estonia for cryptocurrency exchanges. Also, a payment account in any credit institution or payment institution (with a branch in Estonia or offering cross-national services) established in EEA (European Economic Area will be valid.