Estonia is often praised as one of the most crypto-friendly countries within the European Union, but more than 1,000 crypto companies have had their Estonian licenses revoked in this year alone. According to a news outlet Postimees, the country’s financial regulator, the Financial Intelligence Unit (FIU), had revoked nearly 70% of all the crypto licenses that had been issued in this year alone in Estonia. The Government Committee for the Prevention of Terrorist Financing and Money Laundering was Veiko Tali and a statement was made about this matter. According to Tali, they will be keeping a very close eye on crypto companies that have been allowed to maintain their license.
The regulator will be probing for any possible risks, especially where money laundering is concerned. Once the purge was completed, there were only 400 crypto companies in Estonia that were left standing with their licenses. It had only been announced last year by the financial regulator that almost 900 crypto companies had been operating within Estonia. The crackdown on the crypto firms had begun in June of this year when the FIU had revoked the licenses of almost 500 firms. This was primarily because of a money-laundering scandal that had been uncovered in the country and was to the tune of $220 billion.
Another key factor that was put forward was that any crypto company that wouldn’t begin its operations within six months of being granted its license will also have its permit withdrawn. Madis Reimand, the leader of the FIU at the time, had stated that the measures taken in June were simply the first steps that were taken for cleaning up the crypto market within the country. Back in 2017, Estonia had been regarded as a trailblazer in the crypto industry. A number of laws had been introduced in the country, which seemed to openly encourage crypto exchanges as well as ICOs.
However, this didn’t last for long as the country’s regulatory landscape changed and went beyond the Know Your Customer laws that had been mandated back in 2019 by the European Union. While this certainly helps in ensuring that crypto firms in Estonia are reliable, the problem is that a lot of companies have to struggle to get their licenses to even launch their operations in the first place. Nonetheless, hopefully Estonia will be able to regain its position as a pioneer in the crypto space.
The country is definitely not the only relatively small nation that is attempting to make its mark on the global crypto industry, which is expanding at a rapid pace. Malta has also been working on trying to create a ‘crypto island’, but has recently had to face a lot of resistance from its local banks as well as a lack of proper skills amongst Maltese citizens for making the country a hub for crypto. The fact that there was also a scandal associated with the government where none of the crypto businesses operating in the country had been granted licenses was also a setback.
