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The adoption of security tokens, or the more commonly used name, cryptocurrencies have been growing in recent years. Since the first cryptocurrency Bitcoin, founded in 2009, many other digital currencies have emerged into the market. According to Reuters, there are over 2,000 types in circulation. Similar to traditional investments such as equities or stocks, bonds and funds, a marketplace is needed for such securities to be traded – and it is the same for cryptocurrencies. Over the years, multiple cryptocurrency exchanges have emerged where some are regulated and deemed safe, there are others that are anonymous in ownership and physical location. It may be surprising to know that the set-up of cryptocurrency exchanges are not all that complicated. We advise that in order to have a sustainable and long-lasting cryptocurrency exchange, it is important to consider the establishment of the exchange. Not only in terms of reliability but also for tax purposes.

This comparative legal review found in the PDF above as well will look into the set-up of cryptocurrency exchanges in renowned jurisdictions: Switzerland, Malta and Lithuania. Kindly take note that it should be borne in mind that this comparison does not purport to be legal advice and all the contents are drafted on the basis of information provided to us. Readers should note that at the date of circulation of this comparative legal review, the laws and regulations to which this comparative legal review makes reference, may be subject to further amendments which will not be reflected here.


Authorising Authority

Swiss Financial Market Services Authority - FINMA

Type of License

FinTech License

Relevant Activity

The FinTech License is applicable to anyone who is primarily active in the financial sector, who professionally accepts public deposits of up to CHF 100 million or who carries out public offerings to obtain them, but neither invests nor pays interests on the deposits.

One of the business models within the scope of the FinTech License is providing wallets for crypto tokens.

A crypto token wallet provider falls within the scope of the FinTech License if:

  1. the crypto token wallet provider has a repayment obligation towards the clients;
  2. the wallet provider provides brokerage
    services in relation to foreign exchange and cryptocurrencies; and
  3. the wallet provider as a broker, holds clients’ assets for a period of no longer than 60 days.


  1. Register a Company in Switzerland as a company limited by shares (AG), limited liability company (GMBH) or a limited partnership with shares (société en commandite par actions); and ;
  2. Apply for a FinTech License with FINMA.

Licensing Fees

Licensing may cost up to approx. CHF 50,000.

A supervisory levy consisting of a fixed basic levy of CHF 3,000 plus an additional levy, 20% of which is calculated based on the balance sheet total and 80% of which is calculated based on gross income.

Minimum Share Capital

A minimum share capital of three percent (3%) of the public deposits received, but not less than CHF 300,000.

FINMA might request for additional own equity depending on the actual activity.


  1. Preliminary checks and presentation of the licensing documents to FINMA (i.e. preparing the license application and internal audit report by the auditor);
  2. Submission of license application;
  3. Responding to FINMA’s questions and additional requirements;
  4. FINMA confirms completeness of application;
  5. FINMA grants conditional license;
  6. Operational implementation of the conditions
  7. Set out by FINMA.
  8. Confirmation that the conditions are met and
  9. License is granted.

Appointments required

Licensees are obliged to have the following in place:

  1. Representation of at least two persons in Switzerland having joint signatory powers;
  2. A management body whose members shall be domiciled in a place which allows them to exercise the effective management of the activities (if not in Switzerland). The management body shall be composed of at least three members (depending on the activities, 1/3 of the members shall be independent);
  3. A body corporate which is also responsible for the ultimate supervision of the business (FINMA has the authority to grant exceptions and/or impose other conditions);
  4. A proper internal control system with an independent body from the profit oriented business unit which is responsible for the supervision of compliance and risk management;
  5. Prudent auditors for ongoing activities; and
  6. Auditors for the licensing process (may be required by FINMA).

Final Remarks

The FinTech license provides for attractive corporate tax rates, low taxes in several cantons and the possibility of exemption from dividend tax.


Authorising Authority

Malta Financial Services Authority - MFSA

Type of License

Class 1 or Class 4 License in accordance with the Virtual Financial Assets Act (the “VFAA”).

Relevant Activity

The applicable license depends on whether the company would be holding or controlling clients’ assets or money.

Class 1: License holders are authorised to receive and transmit orders and/or provide investment advice in relation to one or more virtual financial assets and/ or placing the virtual financial assets. Class 1 license holders are not authorised to hold or control clients’ assets or money.

Class 4: License holders are authorised to provide any Virtual Financial Assets (“VFA”) service. Class 4 license holders may hold or control clients’ assets or money in conjunction with the provision of a virtual financial assets service.


  1. Register a company in Malta as a private limited liability company (Ltd) or a public company (plc); and
  2. Apply for a VFA license with the MFSA.

Licensing Fees

Class 1 license (receiving and transferring orders, consulting on virtual financial assets); Application Fee EUR 6,000; and Annual Supervisory Fee of EUR 5,500 for revenue up to EUR 50,000 and EUR 700 for every EUR 50,000 up to a maximum of EUR 1,000,000.

Class 4 license (VFA operations, including holding clients’ assets or money); Application Fee EUR 24,000; and Annual Supervisory Fee of EUR 50,000 for revenue up to EUR 1,000,000 and EUR 5,000 for every further tranche of EUR 1,000,000 up.


Preparatory Phase

The applicant must notify the MFSA in writing, through its VFA Agent, of its intention to apply for a VFA license by drafting a statement of intent.

The statement of intent should include:

  1. A comprehensive written description of the proposed structure;
  2. The VFA service for which license is being sought, identifying the persons proposed to hold key positions thereto; and
  3. A legal opinion explaining how the proposed activity does not fall within the scope of traditional financial services legislation.

The MFSA upon receipt of the aforementioned statement of intent shall schedule a preliminary meeting with the Applicant. Following such meeting, the applicant then has 60 days to submit a complete application pack to the MFSA.

Pre-Licensing Phase

The MFSA shall review the information set out in the application and the completion of the fitness and properness assessment, once satisfied, it will issue an ‘in principle’ approval valid for a period of three months from the date of issue.

Applicants have those three months to finalise and meet the conditions of the pre-licensing in principle approval issued by the MFSA. Upon satisfaction the MFSA will then grant the license accordingly.

Post-Licensing Phase

Prior to the commencement of business, the license holders may be required by the MFSA to satisfy a number of post-licensing conditions within a stipulated timeframe.

The license holder shall start providing its VFA services within 12 months from the date of issue of the VFA license.

Appointments required

The license holder is required to appoint and have in place at all times the following functionaries:

  1. An Auditor;
  2. An Anti-Money Laundering Reporting Officer; and
  3. A board of administration.

The appointment of a systems auditor and a custodian is optional.

Final Remarks

In Malta this licensing process might be lengthy, and difficult to obtain.

Additionally, one of the main requirements of having a Maltese company is the opening of a bank account in the name of the company, however most Maltese banks are being reluctant to open a bank account for companies.


Authorising Authority

Bank of Lithuania

Type of License

  1. Crypto Exchange Registration; or
  2. Electronic Money Institution (“EMI”)

Relevant Activity

  1. Companies that are registered as a crypto-exchange in Lithuania are able to exchange cryptocurrency for and on behalf of the client for a commission fee. Crypto-exchange operators‘ registration in Lithuania however, does not allow the company to provide money remittance services or exchanges of any kind from or to FIAT currencies. For companies in Lithuania to provide money remittance services they must obtain the licence of a payment institution or e-money institution as required.
  2. Payment services including the issuance and redemption of electronic money

N.B. The Lithuanian Authority strongly advises that regulated financial institutions (i.e. payment institution/e-money institution) should refrain from dealing with crypto assets.


Crypto Exchange Registration

  1. Register a Company in Lithuania as a private limited liability company (UAB) or a public limited liability company (AB); and
  2. Register for a crypto exchange with the Bank of Lithuania.


  1. Register a Company in Lithuania as a private limited liability company (UAB) or a public limited liability company (AB); and
  2. Apply for an EMI license with the Bank of Lithuania

Licensing Fees

The License Application Fee costs EUR 1,463.

An additional capital reserve depending on the business model, averages EUR 250,000.


After the submission of application for an EMI license, the The Bank of Lithuania’s supervisory authority shall assess and review the completeness of the application within 5 days of application.

The supervisory authority shall then provide the applicant of the EMI with comments and additional requests for documents and information, as may be required. Following detailed review of all documents provided by the applicant, the supervisory authority, shall formulate an assessment and analyses in the form of a summary. The summary is then provided to the Bank of Lithuania, for its review which will then issue its the approval or refusal of the license.

Appointments required

Licensee are obliged to have the following in place:

  1. Members of Management Board
  2. A CEO (could be one of members of Management Board);
  3. A Country Manager fluent in Lithuanian (it is not required if the CEO meets this requirement);
  4. A Local Anti-Money Laundering Reporting Officer; and
  5. An Internal Audit Officer (may be outsourced).

Final Remarks

It is very important to note that the crypto exchange registration in Lithuania does not allow for any exchanges from or into fiat currencies. In Lithuania, money remittance services are only provided by payment institutions or EMI. However, payment institutions and EMIs in Lithuania are strongly advised not to trade in crypto-assets.

Our Experience

lecocqassociate provides a full range of financial regulatory, corporate and commercial advice in relation to the structuring and incorporation of entities.

This article is for information purposes only. It does not constitute professional advice or an opinion. Please contact us for any questions.

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