As regulations tighten and governments show increasing interest in building Bitcoin reserves, more companies are turning to jurisdictions that maintain a supportive stance on digital assets, offering clear guidelines without excessive red tape.

In this article, Yuliya Barabash — Managing Partner at SBSB Fintech Lawyers — examines key licensing issues for crypto businesses in 2025. She analyzes the new EU regulatory environment under the Markets in Crypto-Assets (MiCA) regulation and outlines promising alternatives such as El Salvador, Argentina, Bosnia and Herzegovina, Seychelles, as well as unlicensed jurisdictions like Panama and Costa Rica.
(Crypto Licence Choices in 2025)

European Union: The MiCA Era

Since January 2025, the European Union (EU) has enforced the MiCA regulation, unifying requirements for Crypto-Asset Service Providers (CASPs) across all member states, replacing previously fragmented local regimes.

It’s important to note that failure to comply with MiCA requirements may result in significant penalties within the EU. Fines depend on the nature of the violation and are determined by each member state

Examples:

• Czech Republic: Up to CZK 16,587,000 (~€661,000) for providing crypto services without a license.
• Lithuania: Up to €5 million or 5% of annual turnover for violations of Regulation (EU) 2023/1114; up to double the value of illegally earned revenue for unauthorized CASP activity.
• Malta: MFSA may impose fines up to double the amount of profits or losses avoided, with caps of €700,000 for individuals and €5 million or 5% of turnover for legal entities.

Companies that operated as CASPs before 2025 benefit from a transitional period, allowing continued operation while awaiting license approval. This period is capped at 18 months and varies per country.

Entities registered before December 30, 2024, as Virtual Asset Service Providers (VASPs) under FATF standards can also transition to the MiCA framework during 2025–2026.

Licensed CASPs include:

• Boerse Stuttgart Digital (Germany)
• Bitpanda (Austria, Germany, Malta)
• MoonPay, BitStaete, FinTech ZBD, Hidden Road (Netherlands)
• OKX (Malta)

MiCA requires all crypto companies serving EU clients to obtain CASP authorization—unless the client initiates contact with the company outside the EU, under the reverse solicitation rule.

Reverse solicitation prohibits:

• SEO targeting EU regions
• Geo-targeted ads to EU users
• Websites in official EU languages without valid need
• Sponsoring EU events
• Redirecting EU users to a service provider’s website

If your target audience is in the EU, you must obtain a CASP license in your country of incorporation.

Requirements to obtain CASP status:

• At least one EU-resident director
• A physical EU office with appropriate staffing
• Capital between €50,000 and €150,000 depending on service type
• Internal controls, conflict of interest management, AML/CFT policies

Authorized CASPs can passport their services across all EU countries.

Legal support includes:

• Preliminary business activity assessment
• Document preparation
• Step-by-step roadmap

The licensing process can be costly—ranging from €30,000 to €60,000. DORA regulation also requires ICT security and stability, adding further compliance costs.

In my opinion, while these expenses are significant, they are often seen as a necessary investment to ensure long-term legitimacy and security in the fast-evolving crypto space. However, it’s important for businesses to carefully assess whether the benefits outweigh the costs, especially when exploring alternative jurisdictions with potentially lower fees and less stringent requirements.

In my view, this seems accurate — it appears that only well-established companies with significant resources will be able to navigate the complexities of MiCA’s regulations. Smaller players may struggle to keep up with the financial and compliance demands required by the framework.

Estimated timeline:

• Document preparation: 2–3 months
• License issuance: ~6 months

El Salvador: Bitcoin Hub and Tether’s Choice

El Salvador pioneered crypto regulation by legalizing Bitcoin in 2021 and adopting a digital asset issuance law in 2023. In 2025, Tether moved its headquarters there. Binance, Bitfinex, KoiPay, and GlobiancePay also operate in the country.

Two license types:

• Bitcoin Service Provider (BSP) – issued by Central Bank (BCR)
• Digital Asset Service Provider (DASP) – registered with CNAD

El Salvador has more relaxed requirements than MiCA regarding capital and operations.

Advantages:

• Clear legislation and government support
• Fast DASP licensing process
• Responsive regulators
• Flexibility—shareholders can be non-residents
• Tax incentives—DASP-licensed companies are exempt from income tax

DASP license requirements:

• Minimum two shareholders (clean legal standing)
• $2,000 capital
• Virtual address (physical office optional)
• Cybersecurity standards and external audit
• Bookkeeping and regular reporting
• AML/KYC compliance

Procedure:

• Company registration
• CNAD DASP license
• Corporate account setup
• State authority registration (tax, social security, labor, finance)

Duration: 3–6 months

Cost: ~€25,000

From my perspective, El Salvador does offer a solid alternative to MiCA, but it’s important to recognize that it demands both time and financial commitment to fully navigate its regulatory landscape. It’s a viable option, but companies need to be prepared for the investment required.

Argentina: Friendly to Crypto Startups

In my view, this makes Argentina a very appealing option for new and growing crypto businesses. With fewer regulatory hurdles and lower expenses, it provides an excellent opportunity for startups looking to establish themselves without the heavy financial burden of more established jurisdictions.

Crypto-fiat exchange, stablecoin issuance, and asset-backed tokens are permitted.

On March 25, 2024, CNV mandated PSAVs (virtual asset service providers) to follow FATF AML/CFT rules and register in a national registry.

Active platforms include:

• Binance Services Latinoamérica
• Coinbase
• ByBit
• Bit2Me

Timeline: Up to 4 months (company registration, CNV and UIF filings)

Bosnia and Herzegovina: EU Without MiCA

Bosnia offers an option to stay in Europe while avoiding MiCA. VASP registration is possible in the Republic of Srpska.

Benefits:

• Simple legal framework
• 10% fixed corporate tax
• Access to EU and local bank accounts
• Minimal capital, no physical office required

Examples:

• DCX Exchange
• Adriatic Crypto Exchange
• Crypto Trading Management Servis

Requirements:

• Personnel
• ~$580 capital
• Registered office and internal policies
• Accountant and tax reporting

Timeline: ~4 months (each step ~1 month)

In my opinion, this makes it an ideal choice for entrepreneurs looking to launch their crypto ventures quickly and cost-effectively. The simplicity and affordability of the process can provide a significant advantage for startups that need to move fast in a competitive market.

Seychelles: Regulated Crypto Harbor

Long a crypto hub due to light regulation, Seychelles adopted licensing rules in 2024—providing legal clarity while maintaining benefits.

Requirements:

• Two directors (one local)
• Qualified staff, good standing
• Physical office and annual financial reporting

Fees:

• €5,000 application
• €5,000 base annual
• €5,000–25,000 per business activity

Timeline: 5–9 months

Unlicensed Alternatives

Companies not working with fiat can consider jurisdictions without mandatory crypto licensing.

Costa Rica:

• No capital requirements
• One shareholder/director
• Territorial taxation (no tax on foreign income)
• No audit/reporting obligations
• Confidential registries
• Local bank account options

Projects: SLEX Exchange, Pursa, Coinpay

Panama:

• No capital requirement
• One shareholder, three directors (non-residents allowed)
• Territorial tax principle
• No mandatory AML/KYC
• Beneficial owner confidentiality

Projects: Polymarket, Mantle Network, Meta Pool

Registration is remote and takes under a week.

From my point of view, unlicensed options offer a practical way to enter the crypto space with minimal risk and cost. They’re especially useful for testing product-market fit or running MVPs before committing to a full regulatory setup.

Conclusion

When choosing a jurisdiction for a crypto business, consider:

• Legal framework
• Banking and financial infrastructure
• Taxation
• Licensing cost and duration

If targeting the EU market, MiCA compliance is mandatory—demanding but trust-enhancing. CASP licensing is complex and costly, potentially reaching €250,000 with all operational expenses.

To stay in Europe without MiCA, consider Bosnia. For global markets, El Salvador, Argentina, or Seychelles offer favorable laws and low entry barriers, though with prep time and budgets of €20,000–50,000.

For non-fiat operations, Costa Rica and Panama are the most accessible.

From my experience, trying to navigate the regulatory maze without support is a huge challenge — especially when you need to move quickly and focus on building your product. It’s crucial to set up a solid legal strategy early on and choose a jurisdiction that works with you, not against you. Trust me, in these situations, going solo is risky. Always consult with professionals who can guide you through the process and help avoid mistakes that could cost you down the road.