Estonia has seen an approximately 80% reduction in registered crypto firms due to the implementation of the 2022 crypto law, which mandates substantial capital reserves and legitimate connections to the country. The Financial Intelligence Unit (FIU) revealed that around 200 licenses were voluntarily withdrawn by companies, while the regulator denied a similar number.
Suspicious circumstances surrounding applications
Matis Mäeker, the FIU’s director, noted that the renewal of authorizations revealed surprising situations, with some applications indicating potential links to illegal activities. Instances of unaware individuals being appointed to management boards or using fake credentials were discovered. Many applications shared identical documentation, as several companies utilized the same legal and professional service firms.
Transition to on-site supervision
Mäeker explained that the FIU would soon shift from paper-based evaluations to regular on-site supervision. Estonia, home to digital giants like Wise, Bolt, and Skype, aims to rebuild its reputation after the Danske Bank money laundering scandal involving Russian funds. As an EU member, Estonia must also comply with the Markets in Crypto Assets regulation, which requires wallet providers and exchanges to obtain a license.