Lithuanian foremost bank –the Central Bank of Lithuania has commenced a cryptocurrency discussion between various stakeholders in the industry. The apex bank has begun exploring the use of cryptocurrency in the country and has engaged the country’s commercial banks, government regulators and traders in order to create a quick and cheap license for ICOs to operate.
The Baltic Times, a local news outlet, reported that the central bank has played host to delegates from the Financial Ministry, The Financial Crime Investigation Service (FNTT), the banking sector and also various ICOs. The report also revealed that Lithuania’s Central Bank aims to make the country an “European Fintech Hub’”. The bank would, however, still require financial institutions to clearly separate its traditional services from crypto-related services.
Understanding Cryptocurrency is Key To Attracting Investors
Jekaterina Govina, Bank of Lithuania fintech strategy coordinator told Baltic Times that “blind denials” and reluctance to understand the workings of the cryptocurrency industry would result in more harm than good. He continued, “It’s necessary that banks speak to those who have carried out an ICO or those who convert cryptocurrencies into conventional money. A dialog has been established and it remains to be seen where it will lead us.”
During the stakeholders meeting, the head of the Association of Crypto-economy Market Participants Vytautas Kaseta remarked that commercial banks are making it difficult for cryptocurrency companies and startups to obtain banking services, a situation which dissuades potential investors. “Commercial banks don’t understand the nature of the crypto-business and the business model. Therefore, they regard it as a high-risk business and require additional proofs of the origin of money and investment, and often refuse to open accounts for companies,” Kaseta offered.
A Renewed Interest in Cryptocurrency with some caution
This is not the first time that the Bank of Lithuania is indicating its interest in cryptocurrency, in October last year it issued a document detailing its position on ICOs and digital currencies in the country. The document stated that financial services who engage in cryptocurrency activities should be aware of the possibility of their services being used for perpetrating financial crimes or terrorist financing terrorist financing prevention legislation, and also to take appropriate measures to manage the risk of money laundering and/or terrorist financing.
Solomon Sunny is the market reporter for Smartereum, one of the global leaders in Ethereum, blockchain and currency news. He produces technical price updates on digital currencies and writes recent developments about blockchain.