Regulators in Estonia have stripped 500 cryptocurrency licenses from firms operating in the country in a nationwide crackdown on the industry. The number of crypto licenses that have been revoked represent about a third of the total number issued.
Regulators suspect that crypto firms and Bitcoin exchanges have been leveraging their platforms to commit illicit transfers including embezzlement,
Madis Reimand, head of the Estonian Financial Intelligence Unit says, via Bloomberg,
“This is a first step in tidying up the market, allowing us to take care of the most urgent issues by permitting operations only for companies that can be subjected to Estonian supervision and coercive measures.”
The strike to Estonia’s crypto industry follows allegations that a local branch of Danske Bank facilitated the transfer of billions of dollars in illicit cash. The Danish lender has been embroiled in the largest money-laundering scandal in Europe to the tune of $220 billion. Dubbed the “Troika Laundromat Scandal”, long list of banks and financial institutions allegedly cooked books and fudged figures to facilitate illegal transactions behind closed doors.
In an effort to minimize the risks related to money laundering, the Estonian government passed a bill that makes it difficult for applicants to acquire a crypto license. According to new regulations, permits for cryptocurrency companies will now take three times longer to obtain and will be 11 times more expensive, providing further barriers to entry.