Estonia Revokes Operating Licenses From Nearly 400 Crypto Firms: Here’s Why -Dlight News

Estonia Revokes Operational Licences of Nearly 400 Crypto Firms, Deploys New Rules

Estonia is introducing stricter policies to regulate the proliferation of crypto activities from and within its region. In recent days, the Estonian government has revoked the operating licenses of 398 virtual asset service providers. The move comes almost a year after the northern European country changed its anti-money laundering laws to ensure cryptocurrencies and similar digital assets are not misused to transfer illicit money right under the government’s nose.

The Financial Intelligence Unit (FIU) of Estonia analyzed and decided which crypto companies are not allowed to offer their services there. After this cut, around 100 crypto firms have currently managed to keep their work permits in Estonia, according to Bitcoin.com called in a report.

The names of the companies that have lost their licenses in Estonia remain secret for the time being.

The FIU informed the companies about the status of their compliance with the legal requirements that Estonia has set for the companies in this sector. Regulators allowed companies that had filed correct documents, operated in accordance with the law, and had policies in place to mitigate any risk to retain their licenses.

“In the applications we found a lot of suspicious facts on various topics. This questions the credibility of the companies that wanted to do business here – their actual desire to offer services in Estonia or vice versa shows the desire of certain individuals to use the Estonian economic and financial system for illegal activities,” Matis Mäeker said Director of the Estonian FIU in one blog entry.

In 2017, Estonia started issuing crypto licenses in a loosely regulated ecosystem. This led to several crypto companies flocking to the country to set up their businesses in crypto-friendly Estonia.

However, between 2017 and 2022, the Estonian government found that some notorious companies were taking advantage of the largely unbound set of rules and selfishly minting money without contributing to the country’s economy.

This was the trigger that led the Estonian government to change its laws in 2022 to monitor the companies dealing with virtual digital assets.

After the change in anti-money laundering laws in Estonia, over 200 crypto companies voluntarily revoked their business licenses in Estonia.

“We will continue to review license change requests, but soon we can return to normalcy in oversight, where we will largely move from paper assessment to day-to-day on-site oversight,” Mäeker said.

Research platform Triple-a estimates that currently over 32,000 Estonian citizens own cryptocurrencies.

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