Global: Latvia Introduces Fast-Track Pre-Approval for MiCA Compliance

Latvijas Banka, Latvia’s central bank, is set to begin accepting applications and issuing operating permits for crypto-asset service providers in January 2025, coinciding with the implementation of the European Union’s Markets in Crypto-Assets (MiCA) regulatory framework. This EU-wide legal framework aims to standardize licensing and operations for the crypto industry across member states.

Streamlined Pre-Licensing Process

To ensure a smooth transition, Latvijas Banka is launching a pre-licensing consultation process. This initiative provides tailored guidance from bank experts on application viability, regulatory compliance, and document readiness. With a 48-hour response time, the pre-licensing process aims to minimize downtime and accelerate time-to-market for crypto services after MiCA regulations come into effect.

Pre-licensing initiatives in other sectors have proven effective, enabling companies to secure licenses in as little as three months.

A Fintech-Friendly Regulatory Landscape

Santa Purgaile, Deputy Governor of Latvijas Banka, emphasized Latvia’s commitment to fostering innovation within a fintech-friendly regulatory environment.
“Latvia offers a regulatory ecosystem that is both innovative and aligned with EU standards. Latvijas Banka’s framework balances flexibility with responsibility, streamlining licensing processes and lowering barriers to entry. Our dedicated team prioritizes rapid, professional feedback—responding within hours rather than months,” Purgaile stated.

Key Benefits for Crypto Service Providers

Approved crypto-asset providers will benefit from:

1. Scalability Across the EU: A license from Latvijas Banka allows firms to passport services across EU member states seamlessly.
2. Competitive Supervision Costs: Licensed firms will pay a supervisory fee of 0.6%, with a minimum annual fee of €3,000.
3. Accessible Support: Consultations, available online or on-site, are free of charge, offering comprehensive assistance for navigating MiCA’s regulatory requirements.

Marine Krasovska, Head of the Financial Technology Supervision Department at Latvijas Banka, highlighted the competitive advantages of Latvia’s regulatory ecosystem.
“A license from Latvijas Banka provides a gateway to fast EU market scaling. Latvia has achieved excellence in compliance and is well-equipped to support companies navigating MiCA’s complex requirements. Additionally, our competitive supervision costs further enhance the attractiveness of setting up operations in Latvia,” Krasovska noted.

Looking Ahead

With its fintech-friendly approach and robust compliance framework, Latvia positions itself as a prime destination for crypto firms aiming to operate under the MiCA framework. The introduction of this fast-track licensing process reinforces the country’s dedication to innovation and its commitment to enabling seamless entry for crypto businesses into the EU market.