Once a major hub for cryptocurrency startups, Lithuania has seen its crypto sector contract sharply following the implementation of the Markets in Crypto-Assets Regulation (MiCA) in the European Union (EU).
As of January 2026, only three Crypto-Asset Service Provider (CASP) licenses had been granted by the Bank of Lithuania, a far cry from the 324 registered crypto companies in 2024, according to Giedrius Būdvytis, a Lithuanian lawyer specializing in fintech and cryptocurrency.
Būdvytis attended a consultative event on the CASP licensing process, organized by the Bank of Lithuania in mid-December 2025. In a LinkedIn post, he shared key takeaways, including data from the central bank, common pitfalls, and the regulator’s expectations.
In 2025, only 102 MiCA license applications were submitted to the Bank of Lithuania, Būdvytis reported. This figure stands in stark contrast to the number of crypto companies registered before MiCA entered into force at around 850 in late-2022.
These 102 applications came from just 55 companies, suggesting that many applications were initially rejected and later resubmitted. This indicates a gap between applicants’ expectations and the regulator’s requirements.
The Bank of Lithuania also noted that around 30% of all MiCA license applications in 2025 were submitted in October and November, immediately before the MiCA transitional licensing requirement deadline.
This transitional phase, also referred to as the grandfathering period, allowed crypto services providers operating legally in Lithuania before December 30, 2024 to continue offering their services until authorization was granted or refused. Firms had until December 31, 2025 to secure a MiCA license, after which they were required to cease operations in Lithuania.
This surge in filings near the deadline suggests that many firms delayed preparation until the last possible moment, underestimating the complexity of MiCA. It also points to poor regulatory planning and weak compliance culture.
Main reasons MiCA license applications fail in Lithuania
At the event, the Bank of Lithuania also shared common mistakes in 2025 MiCA applications. It noted that many applications failed to clearly identify shareholders, assess their reputations, or disclose the sources of their funds. Also, in several cases, senior management lacked the necessary competency and reputation.
Some applicants exhibited weak organizational structures and governance, with unclear responsibilities, poor internal controls, and unmanaged conflicts of interest, while others revealed inadequate anti-money laundering (AML) and counter-terrorist financing (CTF) documentation and implementation, as well as deficiencies in IT and operational risk management.
Finally, some applicants appeared to be “empty shell” companies with little activity, staff, or substance in Lithuania.
MiCA overview
MiCA, which entered into force in June 2023, institutes uniform EU market rules for crypto-assets. The regulation covers crypto-assets not previously regulated by financial services legislation, with key provisions for issuers and traders, addressing transparency, disclosure, authorization and supervision of transactions.
MiCA was implemented in phases. By December 2024, all rules, including those for stablecoins, e-money tokens, and CASPs, had come into force.
Under MiCA, any company that provides crypto services to EU clients is considered a CASP and must obtain authorization. Examples of CASPs include centralized crypto exchanges, custodial wallet providers, crypto brokers, trading platforms, and crypto asset managers.
CASP licenses are issued by national competent authorities, such as Federal Financial Supervisory Authority (BaFin) in Germany or the Autorité des Marchés Financiers (AMF) in France. Once a company is licensed in one EU country, it can operate across the entire EU through passporting.
As of January 06, 2026, 142 entities had been issued a CASP license, according to the European Securities and Markets Authority. BaFin had been the most prolific, issuing 43 CASP licenses, followed by the Netherlands Authority for the Financial Markets (AFM) with 22, and the AMF with 11.
The most recent licenses were granted to Firefish Europe on January 02, 2026 by the National Bank of Slovakia (NBS), as well as to Bank Frick and DZ BANK on December 23, 2025, by the Financial Market Authority Liechtenstein (FMA) and BaFin, respectively.
Featured image: Edited by Fintech News Baltic, based on image by freepik and inguskruklitis via Freepik
