Registration of a crypto exchanger, registration of a cryptocurrency exchange in the Czech Republic
The Czech Republic is a state with modern political and economic views. It is not surprising that in the Czech Republic it is possible to pay with cryptocurrency everywhere (in the field of food, entertainment, rental housing, sales of goods and services)
Registration of a crypto exchanger in the Czech Republic vs registration of a cryptocurrency exchange in the Czech Republic
If you are just starting your own crypto activities, you should start with registering a crypto exchanger in the Czech Republic as a more simple form of conducting a cryptocurrency business. After obtaining the necessary experience and accumulation of assets, you can proceed to the registration of a cryptocurrency exchange in the Czech Republic.
What is needed for registering a crypto exchanger and registering a cryptocurrency exchange in the Czech Republic?
First of all, to register a crypto-exchange and cryptocurrency exchange in the Czech Republic, it is necessary to select and verify the name of the future Czech crypto-company. Then, the future owner of the crypto-exchanger/cryptocurrency exchange in the Czech Republic needs to collect a package of personal documents, including a certificate of a criminal record. To register a crypto exchanger/cryptocurrency exchange in the Czech Republic, it is imperative to obtain the legal address of this crypto company for a period of one year. At the final stages of registering a crypto exchanger/ cryptocurrency exchange in the Czech Republic, it is necessary to assemble a package of statutory documents of the company in the Czech Republic, pay state fees for registering a crypto exchanger/ cryptocurrency exchange in the Czech Republic and submit documents to the appropriate Czech authorities.
The position of the Government of the Czech Republic regarding cryptocurrency activities, the activity of cryptocurrency exchange and cryptoexchangers on the territory of the Czech Republic
Bitcoin and other cryptocurrencies do not have a clear legislative definition and regulation in the legislation of the Czech Republic. The Czech government interprets cryptocurrency as a product/thing, value, expressed in digital form. Obtaining a special license for the implementation of the activity of crypto-exchange and cryptocurrency exchange in the Czech Republic is not required. However, to secure successful international cryptocurrency activities, you can obtain an EMI license.
There are also no special rules for taxation of the activity of crypto-exchangers and cryptocurrency exchange in the Czech Republic. You also need to consider that the paying with cryptocurrency involves the payment of VAT. Evasion of which entails the corresponding consequences up to the point where the buyer-legal entity is responsible for nonpayment of VAT by the supplier, in case of paying with cryptocurrency.
The position of the National Bank of the Czech Republic regarding the interpretation and regulation of cryptocurrency and cryptocurrency activities
The National Bank of the Czech Republic (hereinafter referred to as the CNB) does not consider Bitcoin to be non-cash or electronic money. Cryptocurrency, according to the official opinion of the CNB, also cannot be considered as an investment tool, and the exchange of fiat money for Bitcoin as a currency exchange. Regarding to this, the CNB does not extend the scope of its regulation to cryptocurrency activities (cryptocurrency exchange, crypto exchangers, conducting ICOs, etc.). The position of the bank due to the fact that Bitcoin and other cryptocurrencies do not have a relatively stable value and purchasing power that is typical of ordinary currencies.
Director of the Department of Currency Control and Payment Systems of the National Bank of the Czech Republic, Michal Vodrazka, stressed that bitcoin can be used when bypassing bans on certain payments, for example, in online gambling. In this connection, he considers that it is necessary that the Ministry of Finance of the Czech Republic should introduce relevant norms in the modernization of legislation regulating activities related to gambling.
What should I be prepared for when registering a crypto exchanger/cryptocurrency exchange in the Czech Republic?
Despite the widespread possibilities in payments for cryptocurrency, in the absence of legislative regulation, the government of the Czech Republic is skeptical about cryptocurrency activities. For its part, the National Bank of the Czech Republic banned local banks from opening accounts for crypto activities, including bank accounts for crypto exchangers and cryptocurrency exchange in the Czech Republic.
It should be noted that when carrying out business, crypto exchangers/ cryptocurrency exchange in the Czech Republic must carry out the procedure for identifying their clients in accordance with the KYC policy. Also, Czech cryptocurrency exchanges and crypto exchangers must comply with AML policy requirements and demand compliance with the AML policy from their clients. The above rules apply to both sellers and buyers of cryptocurrencies, and are caused by the requirements of the Czech Ministry of Finance and the European Parliament due to concerns about widespread tax evasion and the financing of terrorism.
Alternative to the Czech Republic for registration of the crypto exchanger and cryptocurrency exchange
When registering a crypto exchanger/cryptocurrency exchange, you should not dwell on the Czech Republic There are more loyal jurisdiction for the crypto activities, such as Estonia, Malta, United Kingdom. Estonian law provides obtaining a corresponding license for cryptocurrency activities both in Estonia and abroad. Malta can rightly be considered an island of Blockchain, where laws regulating activities related to cryptocurrencies and blockchains are expected to come into force in 2018: The Virtual Financial Assets Act (VFA); The Innovative Technology Arrangements and Services Act; Malta’s Digital Innovation Authority Act (MDIA).
The UK is also loyal to cryptoexchange activity, despite the lack of direct regulation. Cost-effective registration of a crypto exchanger in the UK will make it easy to change fiat money to cryptocurrency and back.
In view of the above, it is worth to think carefully about the choice of jurisdiction for registering a cryptoexchanger or a cryptocurrency exchange. An SBSB professional team will help you with this.
For over five years we have been advising our clients in the areas of corporate law, international tax planning, finance, international licensing and comprehensive business support in more than 40 countries.
We will be happy to help you.