The regulatory application shouldn’t include the phrase “We are in the process of launching a cryptocurrency platform”.

Are customers able to exchange cryptocurrency to fiat? The platform will be able to transfer virtual assets? Does the company have control over client wallets or private keys? Do they manage a digital asset lending platform in the process of distributing tokens or managing a trading platform?

Those differences matter when pursuing a crypto license in Georgia because the services a company intends to provide affect its regulatory preparation, documentation, controls, and capital requirements.

Georgia is an ideal location for fintech companies, but getting into its highly-regulated virtual asset market is more than just registering a business and building a website.

First, Define the Service

Businesses offering virtual assets to third-party clients are required to become Virtual Asset Service Providers with the National Bank of Georgia under the guidelines laid out by PB Services.

In the scope of this are the activities of virtual transfer and exchange of assets and managing trading platforms and cryptocurrency management or custody. According to the regulatory information supplied the concept of custody includes administration of the customer’s private key and wallet.

The technical structure of the product in question is relevant to its position in relation to regulation.

An entrepreneur who is interested in getting an crypto license in Georgia must therefore sketch out the intended customer journey prior to creating the application. What happens when the customer deposits their assets? Who is the person who controls the wallet? Are assets traded or transferred? Who is the one who has the authority to approve a transaction?

The answers that are precise and clear help determine what the business is doing.

Your Business Plan must describe a Real Company

VASP applications need more than just an attractive pitch deck.

According to the information supplied according to the information provided, the National Bank requires a detailed plan of operation that includes financial projections spanning at least three years. They include revenue, expense, and the growth forecast. The plan should also show an actual intention to conduct business in Georgia.

It is crucial to tackle this issue as soon as it is possible.

A business plan designed for investors can answer questions such as how quickly the company’s growth rate can be accelerated. A plan for business that is regulatory must also explain how the operation will function responsibly.

Georgians applying for a VASP license shouldn’t view the commercial model as if it was unrelated. Instead they should be able to connect them.

AML Cannot be added to the end

PB Services has described the preparation process as an important part of it is the measures to prevent the financing of terrorists and money laundering.

The document warns that the import of an AML policy from another country will not be enough as Georgian regulations must be integrated into a company’s framework.

It is also essential to consider the operational systems. The business plan must demonstrate that the systems of the company is able to detect any related or potentially suspicious transactions.

Practically, the compliance of a product must influence its development before it is released. It isn’t a good idea to develop a platform without deciding how AML policies will be implemented. This could lead to unnecessary redesigns and delays.

The services you choose to use can Have an impact on your Capital

The business model should be determined as early as is possible is important for a number of reasons, including the requirement for capital.

According to the thresholds in the documents, kiosks and exchange activities require 150 000 GEL. Platform management for trading requires 350,000 GEL while other covered services need only 250,000 GEL. If multiple services are provided the threshold that is most affluent applies.

This is distinct from normal capital investment or operating capital. Documentation that proves the required amount was actually funded must be submitted with the application and the capital has to be maintained throughout operations.

The person who is aspiring to obtain a crypto-blockchain license in Georgia should consider the capital required by Georgia’s regulatory authorities in his budgeting process before the rest is completed.

Registration isn’t enough to complete the Compliance Work

The calendar of compliance does not expire with the approval. The guidelines outline the ongoing obligations for cybersecurity and risk management as well as technology resilience fraud risk as well as record retention, independent review and complaints from customers.

For example an opinion of an independent auditor on the risk-management framework must be sought within 12 months after registration. The business must also comply with the guidelines regarding handling complaints. They must accept complaints, whether they be oral, written or electronically, and review them within a minimum of a one-month period, and to provide data on complaints electronically to National Bank every month.

These details affect how an experienced applicant approaches licensing.

Imagine that you are using a Georgian VASP Application as the design of an regulated business.

The structure of a company’s business, its service model, and technology, AML controls as well processes for regulating capital, risk and customer service processes have to be consistent.

Georgia continues to offer opportunities for fintech and crypto businesses. Additionally, its regulatory framework provides a defined path to market. However, asking when you can receive a license is not the best way to begin.

It is being able, in a specific manner, to explain what your crypto-related business is planning to do and be able to demonstrate that the business will be doing so in accordance with the Georgian legal framework.