The European Union’s first unified crypto legislation, Markets in Cryptoassets (MiCA), is due to take effect starting in January 2025.
A Bank of Lithuania board member, Simonas Krėpšta, disclosed plans for a regulatory change that will significantly reduce the number of cryptocurrency companies operating in the nation, which has made a name for itself as a refuge for financial technology startups, in a Bloomberg interview on April 2.
Krepsta claims that Lithuania will impose more stringent licensing regulations, which would drive many cryptocurrency businesses out of business the next year. Simonas Krepsta stated:
“The crypto industry failed in a lightly-regulated environment. We have quite a lot of evidence of that in the US, other European countries but also Lithuania. We saw quite a number of failures, embezzlement cases and similar which were quite a blow for the industry.”
There are now 580 cryptocurrency companies based in Lithuania. Nevertheless, Krepsta notes that the licensing procedure is anticipated to start in June 2025 and that only a small percentage of these organizations are anticipated to fulfil the requirements for acquiring complete permits under the new regulatory framework.
Regarding developing unlicensed cryptocurrency businesses in the area, Krepsta expressed worries about possible illegal activities like fraud and money laundering.
However, the official claims that the nation is already creating its own legal framework to control cryptocurrencies, strengthening the regulatory monitoring powers of its regional Financial Intelligence Unit.
