One entrepreneur said that in reality some companies lost their license because the country’s regulator made it very difficult to maintain the license by demanding „ridiculous“ requirements.
More than 1,000 companies active in the cryptomorphic market lost their licenses in Estonia this year. According to the Postimees news agency, the country’s government began hunting several companies after the market was associated with a high risk of money laundering.
At a meeting between members of the government’s anti-money laundering commission, Finance Minister Veiko Tali said that companies working with cryptomorphs need „more attention“ from the authorities to obtain licenses.
The connection of companies that have lost licenses to Estonia is small, with several of them actually operating in other countries. The reason is that in many parts of the world the regulation of cryptomorphs is still obscure, and companies are unable to thrive because of regulatory uncertainty and obstacles from banks, which require them to have a bank account.
Estonia tried to fill this gap by becoming the „Crypto Valley“ of the world, where several entrepreneurs decided to open their businesses.
Many of these companies, however, open business in Estonia and operate in other countries, so if the local regulator tries to stop the business, the company says its headquarters are in Estonia, so they follow the laws there.
To facilitate the opening of these companies and become Bitcoin Billionaire app the world capital of cryptomites, Estonia has done little government control and intervention in the business. But because of a number of companies that were running scams around the world, the country created new amendments to the legislation that came into force in mid-2020.
In 2019, Estonia launched a plan to issue licenses to cryptomotic companies to attract talent and investment to the country. The purpose was to bring financial injections into the economy. However, the plans did not work out very well, as several companies wanted the license just to increase the price of their cryptomorphs.
At the same time, the Estonian Financial Intelligence Agency said that these companies were involved in money laundering. As a result, more than 1,000 companies lost their licenses.
Now, approximately 400 companies continue to conduct their business normally, obeying strict laws. In addition, the government has created an „electronic residence“ program, where entrepreneurs must issue certificates to open bank accounts legally.
Interestingly, this is exactly the opposite of what the government had proposed at the beginning of the program.
Although the government had to worry about fraudulent companies, the revocation of licenses had widespread repercussions.
One entrepreneur said that in reality some companies lost their licenses because the country’s regulator made it very difficult to maintain them by demanding, for example, that entrepreneurs have a home address in Estonia and other „ridiculous“ requirements. So most companies just did not want to adapt to the new rules and let their licenses be revoked.
The number will be higher if you add those who have not yet lost licenses and those who have voluntarily lost or left the country. Said another.