Best Crypto Business Models in the Czech Republic Utilising the New CASP License

For entrepreneurs, the new Crypto-Asset Service Provider (CASP) license is a gateway to the entire European Union crypto market through “passporting” rights. Why the Czech Republic? The country offers a strategic advantage for crypto companies due to its robust legal framework, alignment with EU regulations, and operational ease for businesses seeking to serve the European market.

The new licensing regime means that obtaining a cryptocurrency license in the Czech Republic is now a prerequisite for operating legally in the Czech Republic. The regulatory landscape, shaped by MiCA and local law, defines the requirements and opportunities for crypto companies, ensuring that only compliant business models can thrive in this environment.

In this article, LegalBison will outline the most beneficial business models for licensing under the Czech CASP regime. For an individual analysis of your project and tailored advice, contact our lawyers for a personalised consultation.

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What are the Best Crypto Business Models to Register as CASP in the Czech Republic?

Registering as a Crypto-Asset Service Provider (CASP) in the Czech Republic under the MiCA (Markets in Crypto-Assets) framework offers several strategic pathways. The “best” business model depends on your target market, available capital, and operational complexity.

1. Crypto Exchanges and Trading Platforms (Class 3)

This is the most comprehensive model, designed for businesses that provide infrastructure for multiple third parties to trade digital assets.

• Services: Operation of a multilateral trading platform for crypto-assets;
• Capital Requirement: Minimum EUR 150,000;
• Strategic Advantage: It allows you to build a full ecosystem where users can trade, while also providing all services covered by Class 1 and Class 2.

2. Custodial Wallet Providers (Class 2)

Ideal for businesses focused on securing user assets or facilitating high-volume OTC (Over-the-Counter) trading.

• Services: Safekeeping and administration of crypto-assets on behalf of clients, including private cryptographic key management;
• Capital Requirement: Minimum EUR 125,000;
• Best For: Institutional-grade storage providers, B2B custody solutions, and high-net-worth exchange desks.

3. Fiat-to-Crypto On-Ramps and Brokers (Class 2)

A highly popular model for businesses that serves as the bridge between traditional banking and the digital asset market.

• Services: Exchanging crypto-assets for fiat currency (funds) or other digital assets using proprietary capital;
• Capital Requirement: Minimum EUR 125,000;
• Market Opportunity: This model is essential for retail payment gateways and local exchange services targeting the ~450 million population of the EU through “passporting”.

4. Crypto Advisory and Portfolio Management (Class 1)

A low-capital entry point for fintech startups focused on wealth management and strategic consulting.

• Services: Providing personalised investment advice, executing client orders, and managing discretionary portfolios;
• Capital Requirement: Minimum EUR 50,000;
• Best For: Boutique investment firms, automated “robo-advisors,” and brokerage agents.

Selecting the most effective licensing route in the Czech Republic depends entirely on your specific business model and planned activities. Because the regulatory framework categorises providers based on their service scope and risk profile, companies must align their chosen path with their operational goals to ensure full compliance. LegalBison actively helps crypto projects seeking the Czech registration choose the appropriate license class that corresponds to their business activities.

Dive in: Comparison Between CASP License in Czech vs Poland

How to Obtain the New Crypto Asset Service Provider (CASP) License in Czechia?

The Czech National Bank (ČNB) is the primary authority responsible for granting CASP authorisations. The licensing process requires meeting the MiCA requirements, including regulatory standards for IT infrastructure, AML/KYC procedures, and internal controls.

1. Company Incorporation: Applicants must complete company registration by incorporating a legal entity in the Czech Republic (typically an s.r.o. or a.s.) and establishing an appropriate corporate structure to meet regulatory and operational requirements;
2. Capital Deposit: The company must meet capital requirements by depositing the minimum share capital into an EEA bank account. These capital requirements are part of the MiCA license prerequisites and depend on the license class;
3. Application Dossier Preparation: The application dossier must include a detailed business plan (Programme of Operations) covering a 3-year period, AML/CFT policies, internal risk management systems, and proof of IT resilience (aligned with DORA standards). The dossier must also demonstrate operational readiness and compliance with local substance requirements, such as physical presence and local staffing;
4. Fit and Proper Assessment: UBOs, directors, and other key personnel must undergo a background check as part of the review process, including providing a certificate of their criminal record to prove they have the necessary reputation, skills, and experience;
5. ČNB Review: The ČNB conducts a structured review process, with an official assessment period of 25 working days to check for completeness and a further 40 to 60 working days for the final decision. Throughout the licensing process, it is essential to demonstrate compliance with MiCA requirements.

Expert Legal Guidance on Crypto Licensing

I Have a VASP, Is It Possible to Convert it Into CASP in Czechia?

Yes, but it is an upgrade process, not an automatic conversion. Czechia has established specific transitional rules that allow an existing company to continue operations while upgrading to CASP status during the transition period:

• The July 2025 Deadline: Existing VASPs registered before December 30, 2024, must have submitted their CASP application by July 31, 2025, to benefit from the transitional regime;
• Grandfathering Period: If the application was submitted on time, the provider can continue operating under its old trade license until July 1, 2026, or until the CASP license is granted/refused. During the transition period, the company’s status in the trade license register remains valid and serves as proof of authorisation to conduct business;
• The “Upgrade” Requirements: To transition, the VASP must demonstrate it has scaled its operations to meet MiCA’s stricter standards, specifically regarding capital reserves, client fund segregation, and EU-resident management.

[!IMPORTANT]

A legacy VASP registration does not grant passporting rights. You can only offer services across the EU after your full CASP authorization is issued.

Preparations Crypto Entrepreneurs Need for a Czech CASP License

Obtaining a CASP license requires significant operational “substance” in the Czech Republic. Meeting regulatory requirements and establishing a robust governance framework are also essential to ensure compliance, risk management, and organisational integrity. Operational costs should be carefully considered when preparing for the CASP license.

Entrepreneurs should prepare the following key pillars:

1. Local Substance and Personnel

• Resident Management: At least one director must be a resident of the European Economic Area, and the place of effective management must be in Czechia. Local substance requirements also include having key personnel, such as company owners and directors, who are EEA residents;
• AML Officer: A local, qualified Anti-Money Laundering Compliance Officer must be appointed to oversee transaction monitoring and regulatory reporting. Key personnel, including the AML Officer, must meet local substance requirements;
• Physical Office: A functional office address in the Czech Republic is mandatory for regulatory inspections; a “letter-box” entity will not be approved.

2. Financial Safeguards and Czech National Bank Requirements

• Asset Segregation: Clear procedures must be in place to ensure that client crypto-assets and funds are kept strictly separate from the company’s own assets;
• Banking Relationship: A corporate account in an EEA bank or EMI is necessary to hold share capital and facilitate operations. Companies must also comply with corporate income tax obligations, currently set at 21%, and report all relevant crypto transactions to the tax office as part of their financial safeguards.

3. Technical and Legal Infrastructure

• Cybersecurity Policies: Documentation proving the resilience of ICT systems and security access protocols is required;
• Smart Contracts: For DeFi operations, clear and auditable smart contracts are essential to ensure transparency, participant identification, and compliance with AML/KYC regulations;
• Complaints Handling: A transparent, free-of-charge procedure for handling client complaints must be established and published.

Must read: How Much is the CASP License in the Czech Republic?

Conclusion

The transition from the legacy registration model to the harmonised MiCA framework marks a new era for crypto businesses in the Czech Republic, introducing a comprehensive new crypto regulation and crypto assets regulation that aligns with EU standards.

While the new CASP licensing standards require higher capital and stricter operational substance, they provide a standardised “passport” to offer services across all 27 EU Member States. Under this framework, crypto service providers can provide crypto services and other services related to virtual assets, such as NFT trading or proprietary fund trading, by obtaining the necessary licenses from local authorities.

These regulatory changes help protect investors by ensuring market transparency, financial stability, and safeguarding client interests. They also create significant investment opportunities in the cryptocurrency world, enabling reputable companies to expand, attract strategic partners, and access new funding sources. Navigating these requirements demands a robust legal strategy, meticulous documentation, and a clear understanding of the Czech National Bank’s expectations.

Launch Your Business with LegalBison

As your dedicated legal partner, LegalBison provides comprehensive, turnkey support, including legal support for clients, to help you secure your CASP license in the Czech Republic. Our expert team streamlines the transition, handling everything from the formation of a limited liability company to the drafting of complex MiCA-compliant policies.

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