Also known as virtual money and digital tokens, cryptocurrencies have started to become more and more present in Cyprus, as many local entrepreneurs have become interested in using them for various transactions. This is one of the reasons the government is currently working on a set of rules under which cryptocurrencies will become a means of payment.
Foreign investors interested in setting up cryptocurrency companies in Cyprus can open various types of fintech businesses which center around virtual money.
In 2017, the Central Bank of Cyprus and the Cyprus Securities and Exchange Commission have agreed on considering digital coins under the contracts for difference – CFD – regulations in order to offer a more favorable environment to those interested in starting businesses based on cryptocurrencies.
Under the CFD regulations, a digital token is considered legal if:
At the moment, cryptocurrency companies are treated like investment funds and financial companies in Cyprus, considering they are required to undergo authorization with the Securities and Exchange Commission.
The legislation which currently provides for the creation and authorization of cryptocurrency companies can be explained by our company registration experts in Cyprus.
Both local and foreign investors can set up businesses in the cryptocurrency sector in Cyprus by respecting the Company Law and the financial regulations imposed by the government and the financial authority in this country. Based on the reinterpreted legislation, one can set up various types of cryptocurrency companies, among which:
The registration of any type of cryptocurrency company starts at the Companies Registrar in Cyprus and follows the same steps as any other business in various industries. Our local consultants can help foreign investors during the procedure of company formation in Cyprus.
Even if Cyprus is on the good road to acknowledging cryptocurrencies for wider use than they are currently employed for, the government and the Cyprus Securities and Exchange Commission still have a lot to work on.
At the moment, cryptocurrencies do not fall under the Anti-Money Laundering Regulations in Cyprus, which is why they are regarded as high-risk securities; however, there are no restrictions imposed on those holding cryptocurrencies.
When it comes to the taxation of cryptocurrency companies, these will fall under the same tax regulations as any other type of business, and that is the 12.5% tax rate, which is also one of the lowest in Europe.
Once the cryptocurrency company is registered with the Trade Register, it must submit an application with the Cyprus Securities and Exchange Commission in order to obtain the approval for its operations. However, this requirement does not apply to IT companies conducting mining activities.
Cyprus is one of the most open countries when it comes to foreign investors who have extensive rights when opening companies here. The same principles apply when establishing cryptocurrency companies in Cyprus, no matter if they are required to apply for any license with the Cyprus Securities and Exchange Commission or not. Furthermore, compared to other international jurisdiction, cryptocurrency mining activities have no restrictions in Cyprus.
Another advantage of cryptocurrency companies is that they benefit from the same treatment as all other Cypriot companies.
Call us now at +357 24 656 406 to set up an appointment with our consultants in Larnaca, Cyprus. Evgenios Erotokritou is the CEO of E.R. Team Global Consultants and he will help you open your company in Cyprus as fast as possible.
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