More than 1,000 crypto firms have had Estonia, praised as one of the most pro-crypto countries within the EU, revoke their licenses in 2020.
Only 400 Crypto Firms Left In Estonia
Postimees, a news outlet, revealed that the Financial Intelligence Unit (FIU), the financial regulator for Estonia, had revoked around 70% of all the crypto licenses issued by the country in this year alone. Veiko tali stood as the Government Committee for the Prevention and Money Laundering and Terrorist Financing, and gave a statement about the matter.
According to Tali, a close eye will be kept on the crypto firms that managed to avoid the purge, with the regulator probing for any potential risks, especially towards money laundering.
After the purge, only around 400 crypto-related service providers are left standing with Estonian licenses. It was just last year when the country’s financial regulator announced that 900 crypto firms had been operating in the country just last year.
$220 Billion Money Laundering Scandal Affecting Crypto Space
The crackdown itself happened in June of 2020, with 500 crypto firms seeing their licenses revoked by the FIU. This come as a result of a money-laundering scandal, by the tune of $220 billion, being uncovered within Estonia. Another key factor is any crypto company failing to start operations within the six months of getting the license will have their permits withdrawn, as well.
The head of the FIU at the time, Madis Reimand, declared that the measures taken in June of 2020 were but the first steps in trying to clean up the country’s crypto market.
All the way back in 2017, many had seen the country as a trailblazer in the crypto space. It had pushed out a number of laws that seemed to openly encourage both ICOs and crypto exchanges. This, however, wouldn’t last, as Estonia saw its regulatory landscape change, going beyond the Know Your Customer laws mandated by the EU back in 2019.
While this ensures Estonian crypto firms are remarkably reliable, the counterbalance to this is the fact that crypto firms struggle to get the licensing needed to even begin operations, as well.
Trying TO Carve A Name For Yourself
With any luck, Estonia will quickly regain its position as a crypto pioneer. The nation isn’t the only (relatively) small country trying to put its mark on the global scale through the use of crypto, either.
Malta has long since been trying to create a “crypto island” out of itself, but has recently been receiving resistance from the local banking firms and a general lack of Maltese citizens holding the proper skills needed to make the country a hub.
The fact that the government had a bit of a scandal, where none of the crypto businesses operating within it were licensed, hampered its chances, as well.