With clients in 20+ countries, including Binance, growth-stage companies and innovative startups, we provide expert guidance on crypto licensing in Czech Republi and other key jurisdictions. Contact us today for a free consultation and take the first step toward compliance and growth!
- Introduction
- Benefits of Obtaining a Crypto License in Czech Republic
- Types of Crypto Licenses Available
- Requirements for a Crypto License in Czech Republic
- Steps to Obtain a Crypto License
- Taxation for Crypto Companies in Czech Republic
- Regulatory Authorities and Compliance in Czech Republic
- Frequently Asked Questions
- Conclusion
Introduction
The Czech Republic is emerging as one of the most crypto-friendly jurisdictions in the European Union, offering minimal regulatory barriers and fast licensing processes. Businesses operating in cryptocurrency exchange, custody services, or token offerings can enjoy low startup costs, simplified compliance frameworks, and access to the wider EU market under the upcoming MiCA regulations.
Benefits of Obtaining a Crypto License in Czech Republic
- Fast Licensing Process: Registering a crypto business and obtaining a license can be completed within 2-3 weeks.
- Low Capital Requirements: Companies need only 1 CZK (approx. €0.04) as minimum share capital.
- Access to the EU Market: Licensed entities can operate freely across EU member states under uniform regulations.
- No Local Substance Requirements: Directors, shareholders, and AML officers do not need to be Czech residents.
- Supportive Regulatory Framework: Favorable tax rates, minimal compliance burdens, and clear guidelines for crypto-related activities.
Types of Crypto Licenses Available
Strictly speaking, the Czech Republic does not have separate types of licenses for crypto activities. Instead, crypto companies must follow the general authorization (trade license) for “services related to a virtual asset.” Once registered, these activities fall under the purview of the Czech AML Act and the oversight of the Financial Analytical Unit (FAU).
Because the law defines virtual currency services broadly, your registration can cover multiple activities:
Services Allowed:
- Crypto Exchange Services: Exchanging fiat to crypto and vice versa.
- Crypto-to-Crypto Exchange: Converting one virtual currency to another.
- Custody Services: Managing private keys and wallets on behalf of clients.
- Crypto Transfers: Moving digital assets between wallets.
Activities such as Initial Coin Offerings (ICOs) and escrow services may require additional licenses or legal assessments
Requirements for a Crypto License
Although the Czech Republic keeps the process simple, you must meet a set of legal and compliance obligations, including:
Trade License Registration
- Register your activities: Register your activities under the Trade Licensing Register (Activity No. 81: “Provision of services related to a virtual asset”).
AML/KYC Policies
- Implement internal protocols: Implement robust internal protocols for client identification, transaction monitoring, and record-keeping.
AML Officer
- Appoint an AML Officer: Appoint an individual responsible for complying with AML/CTF (Counter-Terrorist Financing) regulations.
Sanctions & PEP Checks
- Screen customers: Screen customers against international sanctions lists and check for politically exposed persons (PEPs).
Data Protection (GDPR)
- Protect customer data: Ensure you protect customer data in line with the General Data Protection Regulation.
Criminal Record Clearance
- Clean criminal record: The company’s shareholders, directors, and management must have a clean criminal record.
Risk-Based Approach
- Conduct risk assessments: Conduct ongoing risk assessments, adapting your compliance strategy based on national risk guidelines.
Record-Keeping & Reporting
- Maintain accurate logs: Maintain accurate logs of transactions and cooperate with the FAU for any suspicious activity reporting.
Steps to Obtain a Crypto License in Czech Republic
Essential Steps for Setting Up For Czech Republic crypto license
Talk with out founder Mardo Soo
Essential Steps for Setting Up For Czech Republic crypto license
Talk with out founder Mardo Soo
Even though there is no standalone “crypto license,” below is the typical process to register a company and become an authorized VASP in the Czech Republic:
Gather Required Documentation
- Collect KYC information, business descriptions, and criminal record certificates for shareholders and directors.
Register a Limited Liability Company (S.R.O.)
- Prepare the founding documents (Articles of Association, etc.) and have them notarized.
- Verify your company name to ensure it’s not already in use.
- Deposit a minimal share capital of 1 CZK (approximately €0.04).
Obtain a Registered Office
- Secure a physical or virtual office address in the Czech Republic for at least one year.
Submit a Trade License Application
- Apply under the “services related to a virtual asset” category.
Develop AML/KYC Compliance Measures
- Draft internal AML/CFT procedures and data protection policies (GDPR-compliant).
- Hire and train an AML officer and file the required paperwork with the Financial Analytical Unit (FAU).
Register with the Tax Authorities
- Ensure your company is registered for the appropriate taxes (Corporate Income Tax, VAT if applicable).
Optional: Open a Corporate Bank Account
- While not strictly required to get the license, opening a bank or EMI account is recommended for operational purposes and easier fund flows.
- Many crypto-friendly EMI solutions exist across the EU.
Begin Operations
- Once licensed, you can offer crypto exchange, custody, or other blockchain-based financial services as outlined in your business plan.
Looking for a crypto license in Czech Republic? Our team offers a free consultation and quick responses to help you navigate options in Czech Republic and other jurisdictions. Contact us today to start your journey!
Taxation for Crypto Companies
The Czech tax system treats crypto-related businesses similarly to other commercial entities. Here are the key taxes you should be aware of:
- Corporate Income Tax (CIT): 21%
- Tax on Profits (BT): 19%
- Capital Gains Tax (WCL): 0% to 19% (depending on the nature of the gains
- Value Added Tax (VAT): 21% (crypto exchange services are often exempt, but registration may be required for broader services)
- Social Security (SVP): 24.8% (applies to employee salaries)
- Health Insurance (SA): 9% (applies to employee salaries)
Companies classed as Czech residents are taxed on their global income, whereas non-resident companies are taxed only on income generated within the Czech Republic. If your central management is based in the Czech Republic, the business is generally considered a Czech tax resident.
Under EU Court of Justice precedents, exchanging fiat for cryptocurrencies (and vice versa) is often exempt from VAT. However, additional crypto-related services (e.g., consulting or other business activities) could be subject to the standard VAT rate.
Regulatory Authorities and Compliance
In the Czech Republic, several authorities and legal frameworks shape the compliance environment for crypto ventures:
Czech Ministry of Industry and Trade:
- Administers the Trade Licensing Register where you register your crypto activities.
Financial Analytical Unit (FAU):
- Enforces AML/CFT regulations and monitors suspicious transactions.
Czech National Bank (CNB):
- Supervises financial markets. Some crypto services may require additional licensing if they overlap with regulated financial instruments (e.g., security tokens, fund management).
MiCA (Markets in Crypto-Assets Regulation):
- An evolving EU-wide framework set to be adopted by 2024, which will unify crypto regulations across member states.
Key Compliance Considerations:
- Ongoing client identity verification for transactions exceeding €1,000 or if you enter a long-term business relationship (e.g., opening a crypto wallet).
- Reporting obligations to the FAU for any suspicious or large-scale transactions.
- Proper record-keeping in line with IFRS (International Financial Reporting Standards
Frequently Asked Questions
Yes. Cryptocurrency is recognized under EU law and has no outright restrictions in the Czech Republic. Businesses dealing with virtual assets must register as a Virtual Asset Service Provider and follow AML/KYC rules.
Although there is no “standalone” crypto license, you do need to obtain authorization under the Trade Licensing Act for virtual asset services and register with the FAU to remain compliant.
You can typically complete the registration (company + trade license) within 2-3 weeks, making it one of the fastest routes to launching a regulated crypto business in the EU.
Absolutely. There are no residency restrictions on foreign founders. You only need local representation (a registered office address) and adherence to standard compliance.
1 Czech Krone (CZK) per shareholder, which is a nominal amount and extremely affordable compared to many other EU jurisdictions.
No, but opening a bank or EMI account is recommended for operational efficiency. It simplifies fund flows and enhances trust with partners and clients.
- Corporate Income Tax: 21%
- VAT: 21% (often exempt for crypto exchange services)
- Other: Social security, health insurance for employees, etc.
Once MiCA is fully enforced (expected in 2024), companies with a Czech crypto registration will likely enjoy passporting rights throughout the EU, with standardized requirements across member states.
Yes. However, you still need to comply with AML/KYC obligations. If you do not handle fiat at all, you must ensure an equivalent compliance process is in place (e.g., verifying customer identity through permitted eIDAS methods).
No. Local substance is not strictly mandated, although having a local AML officer or representative can streamline compliance with regulators.
Conclusion
The Czech Republic stands out as one of the most business-friendly and efficient jurisdictions within the EU for launching and running a cryptocurrency venture. With a quick turnaround for company formation, minimal share capital requirements, robust yet navigable AML/KYC regulations, and full alignment with EU directives, obtaining a Crypto License in the Czech Republic is a strategic move.
Whether you’re looking to launch a crypto exchange, provide wallet services, or engage in broader blockchain projects, the Czech Republic offers a balanced regulatory environment that fosters growth and innovation. By securing your trade license, implementing strong compliance protocols, and preparing for the upcoming MiCA era, you’ll position your company at the forefront of Europe’s rapidly evolving digital finance landscape.
