Estonia, one of the EU’s friendliest countries in relation to cryptocurrencies, will withdraw licenses from hundreds of companies operating in the crypto industry. According to Bloomberg, this is the government’s response to the $ 220 billion money laundering scandal.
Scandal at the Danske Bank A / S Estonian branch
Estonia was one of the first countries in the European Union to grant licenses to crypto companies. However, the country was forced to withdraw them after detecting hundreds of billions of dollars of dirty money in the Estonian branch of the largest Danish bank – Danske Bank A / S. This event put Estonia at the center of Europe’s largest money laundering scandal.
Despite the fact that Danske Bank A / S’s activities came to light already in 2018, they have not yet been settled. The case is complicated because one of the main people involved in the whole deal, who was responsible for the transaction, committed suicide.
The Estonian branch of Danske Bank was to process hundreds of thousands of transactions for people who were not residents of the European Union in the years 2009-2015. Most of his clients were names from the former Soviet Union.
Madis Reimand, head of Estonia’s financial analytical unit, revealed that regulators suspect that licensed cryptocurrency companies are abusing their Estonian fraud rights elsewhere.
Therefore, more than 500 companies – which is about 1/3 of all cryptocurrency companies – that have not started operations in Estonia within six months of obtaining the license, have their licenses withdrawn.
“This is the first step in ordering the market that will allow us to deal with urgent matters, allowing only companies that may be subject to Estonian supervision and coercive measures.”
– said Madis Reimand.
It’s not over yet. More “purges” are possible
Reimand pointed out that more stringent licensing measures will be introduced in Estonia. More than half of the remaining cryptocurrency companies in the country may also lose their licenses because they do not operate in Estonia, and their management is abroad.