Stablecoin issuer / redeemer in Lithuania
Issues a fiat-pegged stablecoin to the public, operates redemption, and holds reserves backing the float.
Stablecoin issuer is conditionally permitted in Lithuania with a local entity, subject to AML obligations and high licensing burden.
Verdict Details
- Permitted
- conditional
- Local entity required
- Yes
- Licensing burden
- High
- Last updated
- 2026-07-13
AML Obligations
- Internal AML/CTF Rules: Comprehensive written policies and procedures aligned with Lithuanian AML Law and EU directives.
- Risk Assessment: A documented assessment of money laundering and terrorist financing risks specific to the business model.
- Customer Due Diligence (CDD): Procedures for identifying and verifying customers and beneficial owners, including ongoing monitoring.
- Enhanced Due Diligence (EDD): For high-risk customers, PEPs, and complex/unusual transactions.
- Transaction Monitoring: Systems and procedures to monitor transactions for suspicious activities.
- Reporting: Obligation to report suspicious transactions (SARs) to the FCIS.
- Record Keeping: Maintaining records of customer identification data and transactions for at least 8 years.
- AML Officer (MLRO): A dedicated, qualified MLRO must be appointed, who must be a permanent resident of Lithuania.
- For EMTs: Funds received must be placed in a separate account at a credit institution or invested in secure, low-risk assets.
Key Restrictions
- Must hold a full Electronic Money Institution (EMI) license from the Bank of Lithuania (not just FCIS registration for VASPs).
- Applicant must be a legal entity (e.g., UAB – private limited liability company) incorporated in Lithuania.
- Must have a registered office in Lithuania.
- EMTs must be backed 1:1 by fiat currency (e.g., Euros).
- At least 30% of reserve assets must be held as deposits at credit institutions; remainder in highly liquid, low-risk instruments.
- Reserve assets must be segregated from the issuer's own assets and held in custody by an independent third party (credit institution).
- Issuers must have robust liquidity management policies.
- Holders of EMTs must have redemption rights at par value at any time (MiCA Art. 48).
- Minimum €125,000 registered share capital required (per Nov 2022 increase) — but this may be higher under EMI licensing requirements.
- The MLRO must be a permanent resident of Lithuania; other key personnel should have strong connection to Lithuania.
Key Risks
- EMI licensing from Bank of Lithuania is substantially more burdensome than the FCIS VASP registration — expect multi-month application with full prudential review.
- MiCA imposes direct EU-level requirements; any gap between national EMI law and MiCA requirements creates regulatory ambiguity.
- Foreign-issued stablecoins (non-MiCA compliant EMTs/ARTs) face potential restrictions under MiCA transitional provisions and may not be permitted for use locally without authorization.
- Reserve custody and segregation requirements (third-party credit institution) introduce operational complexity and cost.
- Tax treatment of stablecoin operations involves CIT at 15% and VAT exemption only for direct exchange of virtual currency — ancillary services may be subject to VAT.
Evidence
This verdict synthesizes the following facts. Each fact links to its primary source(s).
E-money Tokens (EMTs): These are crypto-assets that purport to maintain a stable value by referencing the value of one single official currency (e.g., a Euro-backed stablecoin).
Classification: EMTs are classified as electronic money under the Electronic Money Directive 2009/110/EC (EMD2), with additional specific requirements imposed by MiCA.
Lithuanian Reference: The Law on Electronic Money and Payment Institutions of the Republic of Lithuania (Lietuvos Respublikos elektroninių pinigų ir mokėjimo įstaigų įstatymas) transposes EMD2 into national law and regulates electronic money institutions (EMIs) in Lithuania.
Must be backed 1:1 by fiat currency (e.g., Euros).
Funds received in exchange for EMTs must be placed in a separate account at a credit institution or invested in secure, low-risk assets.
Issuers must hold at least 30% of the reserve assets in deposits at credit institutions. The remaining part can be invested in highly liquid, low-risk financial instruments with minimal market risk.
Assets must be segregated from the issuer's own assets and held in custody by an independent third party (credit institution).
Electronic Money Institution (EMI) License: Allows issuing electronic money and providing related payment services.
Licensing Regime (Bank of Lithuania): For Electronic Money Institutions (EMIs) and Payment Institutions (PIs), a full licensing regime is in place, involving comprehensive assessment of business plans, financial soundness, risk management, governance, and fit & proper checks, with ongoing prudential supervision.
Legal Entity: The applicant must be a legal entity (e.g., UAB – private limited liability company) incorporated in Lithuania.
A minimum €125,000 registered share capital is required for both virtual currency exchange operators and custodian virtual currency wallet operators. This requirement was significantly increased in November 2022 from a previous €2,500.
AML/KYC Requirements: Robust internal procedures are paramount:
Internal AML/CTF Rules: Comprehensive written policies and procedures aligned with Lithuanian AML Law and EU directives.
Risk Assessment: A documented assessment of money laundering and terrorist financing risks specific to the business model.
Customer Due Diligence (CDD): Procedures for identifying and verifying customers (individuals and legal entities), beneficial owners (UBOs), and understanding the purpose and nature of business relationships. This includes ongoing monitoring.
Enhanced Due Diligence (EDD): For high-risk customers, politically exposed persons (PEPs), or complex/unusual transactions.
Transaction Monitoring: Systems and procedures to monitor transactions for suspicious activities.
Reporting: Obligation to report suspicious transactions and activities (SARs) to the FCIS.
Record Keeping: Maintaining records of customer identification data and transactions for at least 8 years.
Registered Office: Must have a registered office in Lithuania.
AML Officer (MLRO): A dedicated, qualified Anti-Money Laundering Officer (MLRO) must be appointed. This individual must be a permanent resident of Lithuania. They are responsible for implementing AML/CTF procedures, training staff, and reporting to the FCIS.
Management/Board: While not all board members need to be Lithuanian residents, the company must demonstrate sufficient substance and connection to Lithuania, and the FCIS may require certain key personnel (e.g., CEO, board members) to have a strong link to the country.
Regulation (EU) 2023/1114 on Markets in Crypto-Assets (MiCA)
URL: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32023R1114 (See Articles 3, 43, 48)
15% is the standard CIT rate.
Exemption: The exchange of conventional currency for units of the "Bitcoin" virtual currency and vice versa, or the exchange of different virtual currencies, is considered a supply of services for consideration and is exempt from VAT. This also generally applies to transactions involving buying, selling, or exchanging other cryptocurrencies.
Verdict Attribution
- Source:
- AI-Generated · Unreviewed
- AI synthesized:
- 2026-07-13 (deepseek-chat)
- Last updated:
- 2026-07-13
- Confidence:
- high
This verdict was produced by an AI model from the underlying facts. Confirm with counsel before relying on it for material decisions.
Conditional — A stablecoin issuer (of e-money tokens under MiCA) must obtain a full Electronic Money Institution (EMI) license from the Bank of Lithuania, incorporate locally as a legal entity, comply with strict 1:1 fiat backing and reserve segregation rules (30% deposits, third-party custody), grant at-par redemption rights to holders, and meet comprehensive AML/CTF obligations including a Lithuanian-resident MLRO.
Questions this verdict aims to answer
- What e-money or banking license is required to issue?
- What reserve composition, segregation, and audit rules apply?
- What redemption rights must be granted to holders?
- Are foreign-issued stablecoins permitted for use locally?