Getting a MiCA/CASP Licence in Latvia — A Founder's Guide

Choosing where in the EU to base a crypto business used to be a question of which national regime was lightest. MiCA changed that. There is now one rulebook for the whole Union, and the real question is where to apply for the single licence that works everywhere. Latvia keeps coming up in that conversation — and for good reasons. But the reasons are not the ones founders usually expect, and there is an honest catch worth understanding before you commit.

This guide walks through what a MiCA/CASP authorisation in Latvia actually involves: the regulator, the fees, the substance test, the capital you need, the process and timeline, and what to settle before you file. We aim for a balanced picture — what genuinely makes Latvia attractive, and where it is the wrong choice.

This page is general information, not individual legal advice. For how we work with founders, see crypto lawyer in Latvia.

In short

• One licence, the whole EU. A MiCA/CASP authorisation granted in Latvia passports across the Union — you apply once and operate everywhere.
• Fees are among the lowest in the EU: a one-off €2,500 application fee and ongoing supervision capped at 0.6% of gross income, minimum €3,000 a year.
• The catch is substance, not a soft rulebook. Latvia applies the full MiCA and ESMA bar: real office, place of effective management in Latvia, a resident full-time executive, and local control of compliance, risk and ICT — not a registered address.
• Capital is the higher of the Annex IV floor for your service class (€50,000 / €125,000 / €150,000) or one quarter of your previous year’s fixed overheads — and it must be loss-absorbing share capital, not founders’ loans.
• Plan for the better part of a year end-to-end: the formal review clock is roughly three months once your package is complete, but the preparation before it is where applications are won or lost.

From VASP to CASP — what changed

If you have been in the space a few years, you remember the VASP world: each EU country ran its own register, and a crypto business obtained a national AML registration to operate there. That regime was always national in scope and never travelled well across borders.

MiCA — Regulation (EU) 2023/1114 — replaced it. The rules governing crypto-asset service providers have applied since 30 December 2024. Since that date, listed crypto-asset services may only be provided in the EU by an authorised CASP (or an already-regulated entity such as a credit institution or MiFID investment firm).

The old national VASP registrations were transitional. Under MiCA’s grandfathering window, existing providers can keep operating under national law until 1 July 2026 at the latest, or until they are granted or refused a CASP authorisation — whichever comes first. That eighteen-month window was a maximum; several member states set earlier national cut-offs, so the practical deadline can fall sooner than the EU backstop.

The headline difference is the EU passport. A VASP registration got you one country. A CASP authorisation is a single licence that, once granted, works across the entire Union. That is the prize, and it is why the question shifts from “which country is easiest” to “where do I want my one application to land.”

Why founders look at Latvia

The case for Latvia is real, and it is mostly about how the process feels and what it costs — not about a softer rulebook.

• Fees among the lowest in the EU. The one-off application fee is €2,500. Ongoing supervision is capped at 0.6% of gross income per year, with a minimum of €3,000. On those numbers, Latvia sits at the low end of the EU range.
• An accessible regulator. The competent authority is Latvijas Banka (the Bank of Latvia, which is both the central bank and the single financial regulator). It engages constructively and runs a genuine dialogue rather than a black-box review.
• A free pre-licensing stage, in English. Before any formal filing, Latvijas Banka offers a free pre-licensing consultation. Documents at this stage may be in English, and you do not need the Latvian company incorporated yet. The regulator assigns experts who review your model and tell you what to prepare. This is where the structural work gets done, and it materially de-risks the formal application.
• A “thin-wrapper” statute. The Latvian Crypto-Asset Services Law (in force since 30 June 2024) implements MiCA and designates the supervisor, fees, sanctions and appeal route — it does not stack extra national requirements on top of the Regulation. Whatever substance and compliance work you face flows from MiCA and EU technical standards, not from a layer of local gold-plating.
• A workable formal timeline. The statutory review clock is short (see the timeline below), and a prepared applicant can move through it without surprises.
• The full passport on grant. As with any MiCA jurisdiction, authorisation in Latvia gives you EU-wide reach.

Latvia opened MiCA applications on 2 January 2025. As of mid-2026 only a small number of CASPs have been authorised, with more working through pre-licensing and formal review.

The catch: substance is real

Here is the honest part. The thing that makes Latvia attractive — an accessible regulator and a clean statute — does not make the licence easier to obtain. The substantive bar is set by MiCA and by ESMA at EU level, and Latvijas Banka applies it.

Two layers govern substance.

MiCA’s baseline (Article 59). A CASP must have:

• its registered office in the member state where it carries out at least part of its services — a Latvian SIA (sabiedrība ar ierobežotu atbildību, a private limited company), incorporated before the formal application;
• its place of effective management in the Union; and
• at least one director resident in the Union.

ESMA’s supervisory briefing (the Supervisory Briefing on the Authorisation of CASPs, ESMA75-453128700-1263, 31 January 2025) tightens that baseline considerably, and Latvijas Banka applies it via the statute’s hook to EBA/ESMA guidance. In practice the briefing expects:

• place of effective management in the licensing state — Latvia, not merely somewhere in the Union;
• at least one senior executive resident in Latvia, with senior managers actually running daily operations locally;
• the CEO devoting full time to the CASP, and other executive board members at least half their professional time — double-hatting with a parent or other group entities is restricted;
• real local control of compliance, risk and ICT, with decision-making, data control and crisis authority sitting with the Latvian entity rather than headquarters.

On the ground, that means a licensed SIA with a real (not virtual) office and a Latvia-resident executive working full-time on the licence. Separately — under the applicable AML rules rather than MiCA itself — you will need a local AML compliance function, typically a locally appointed AML officer / MLRO. AML operational tasks — transaction monitoring, KYC review, alert handling — can be outsourced; the senior officer and the AML responsibility cannot. There is no fixed minimum headcount, but a token presence will not be accepted; the regulator scales its expectation to the size of the business.

Outsourcing — what can stay abroad

Group functions and infrastructure (engineering, product, support, internal audit, group finance, HR, treasury; transaction-monitoring tooling, KYC, custody, hosting) can stay where they are. But each becomes a regulated outsourcing arrangement:

• under MiCA Article 73, you need a written agreement that preserves the CASP’s responsibility, the regulator’s access to information, and a termination (exit) right; and
• under DORA (Articles 28–30), arrangements supporting critical or important functions require a register of information and prior notification of the planned outsourcing — these register and notification duties live in DORA, not in MiCA Article 73.

Outsourcing critical or important functions outside the EU is permitted but draws scrutiny. Supervisors look at how much of the cost is paid to non-EU providers as a “hollowed-out” indicator, and an arrangement that prevents the regulator from getting information is incompatible with Article 73.

The bottom line: Latvia is the wrong jurisdiction for a letterbox. The ESMA briefing is explicit that outsourcing must not turn the firm into a letter-box entity, that the local CASP must autonomously make decisions, and that the burden of proof is on you to show decision-making does not lie elsewhere. If you intend genuine local presence, Latvia is excellent. If you do not, no jurisdiction under MiCA will quietly wave it through — and Latvia certainly will not.

Service classes and capital

MiCA’s Annex IV sorts services into three classes, each with a permanent minimum capital floor:

Class	Floor	What it covers (examples)
Class 1	€50,000	Reception/transmission of orders, execution, placing, transfer, advice, portfolio management
Class 2	€125,000	Class 1 plus custody and administration, exchange of crypto-assets for funds (on/off-ramp), and crypto-to-crypto exchange
Class 3	€150,000	Class 2 plus operating a trading platform

A point that catches founders out: exchange of crypto for funds is a Class 2 service (€125,000 floor), and a non-custodial model does not lower the class. Classification follows the activity, not whether you hold client assets — there is no custody-based discount in Annex IV. (And if you also operate a trading platform, the whole thing moves up to Class 3.)

Own funds must be the higher of:

1. the Annex IV floor for your class, or
2. one quarter of the previous year’s fixed overheads.

The capital must be paid-in, loss-absorbing share capital and reserves — Common Equity Tier 1 in regulatory terms (Articles 26–30 of the CRR, Regulation 575/2013). Founders’ loans and uncalled capital do not count. (MiCA also allows the requirement to be met, in whole or part, by a qualifying insurance policy — but plan around the capital figure.)

The practical lesson: at any real operating scale, the fixed-overheads measure usually binds well above the floor. Model your own funds off a quarter of expected annual overheads, not off the headline €50k/€125k/€150k number.

The process and timeline

The path runs in this order:

1. Pre-licensing consultation — free, documents in English, company not yet required. Settle substance and entity strategy here.
2. Incorporate the Latvian SIA — the standard minimum share capital is €2,800 (a company-law figure, separate from MiCA own funds; a low-capital SIA from €1 exists but is rarely appropriate here), topped up to meet the MiCA own-funds requirement before the licence is granted.
3. File the formal application — in Latvian — which is why local counsel is needed at this stage. The application fee is €2,500.
4. Completeness check — up to 25 working days.
5. Substantive review — 40 working days from confirmation of completeness, extendable for objective reasons (clarification rounds).
6. Decision — on grant, Latvijas Banka publishes the authorisation, notifies ESMA, and the firm appears on the public CASP register.
7. Passport — notify the home regulator of cross-border activity (branch establishment and/or freedom to provide services) to reach the rest of the EU.
8. Ongoing supervision and reporting.

On timing, be realistic. The statutory clock once your package is complete is roughly three months (≈25 + 40 working days). But the work that determines success happens before the clock starts — preparing the package, settling substance, getting through pre-licensing. End-to-end, from “we have decided to apply” to “licence in hand,” a prepared applicant should plan for the better part of a year, depending on what surfaces in pre-licensing and how clean the package is on first submission.

What to settle before you file

Most failed or stalled applications are lost in the planning, not the filing. Before you submit, get clear on:

• Entity strategy — the SIA structure, ownership and how it sits relative to any group; this is exactly what the free pre-licensing dialogue is for.
• Service scope — which Annex IV services you are authorised for, since this drives your class, your capital, and your obligations.
• Tokens in scope — what crypto-assets you will handle, and any that carry extra treatment.
• Substance plan — the real office, the resident full-time executive, the local MLRO, and which functions you outsource versus own locally, with the MiCA Article 73 / DORA paperwork mapped out.
• Timeline — working back from any commercial deadline, with the prep phase built in, not just the statutory clock.
• Parallel applications — whether you are running any other licensing process at the same time, and how that interacts with this one.

This planning stage — settling MiCA/CASP licensing scope and substance — is where most of the outcome is decided.

Where this connects

A CASP licence does not sit alone. Three adjacent workstreams almost always travel with it:

• AML/KYC programmes — the local MLRO, transaction monitoring, KYC and the policies behind them are a licensing condition, not an afterthought.
• Token launches — what you list and offer interacts directly with your service scope and your obligations.
• DAC8 crypto-asset reporting — the EU’s tax-reporting layer for crypto providers, which lands on CASPs alongside MiCA and AML.

Frequently asked questions

What’s the difference between a VASP and a CASP? A VASP was a crypto business registered nationally for AML purposes under the old regime. A CASP is a crypto-asset service provider authorised under MiCA, the EU regulation that has applied to crypto services since 30 December 2024. The national VASP regime was transitional; under MiCA’s grandfathering window it runs until 1 July 2026 at the latest, though some member states set earlier national cut-offs. A CASP authorisation is a full EU licence, not a national registration.

Does a Latvian CASP licence let me operate across the whole EU? Yes. A MiCA authorisation granted in any one member state passports across the EU/EEA. You notify your home regulator — in Latvia, Latvijas Banka — of the services and host states, and it forwards the notification; host regulators are informed but cannot block the passport. You operate either by establishing a branch or by providing services cross-border, on the strength of the single licence.

Can I run a Latvian CASP as a registered-address-only setup? No. MiCA and the ESMA supervisory briefing require genuine local substance: a real office, place of effective management in Latvia, at least one senior executive resident locally, and real local control over compliance, risk and ICT — plus a local AML compliance function under the applicable AML rules. A letterbox entity will not be authorised. Latvia is the wrong jurisdiction for any structure without genuine local presence.

How much capital do I need? Own funds must be the higher of (a) the MiCA Annex IV floor for your service class — €50,000 for Class 1, €125,000 for Class 2 (including exchange of crypto for funds), €150,000 for Class 3 (operating a trading platform) — or (b) one quarter of your previous year’s fixed overheads. The capital must qualify as Common Equity Tier 1; founders’ loans and uncalled capital do not count. At operating scale the fixed-overheads measure usually binds well above the floor.

How long does it take to get a Latvian CASP licence? Once your application is confirmed complete, the statutory clock is up to 25 working days for the completeness check and 40 working days for the substantive decision — roughly three months of formal review, extendable if clarifications are needed. Realistically, budget several months to prepare the package beforehand; end-to-end, from deciding to apply to holding the licence, a prepared applicant should plan for the better part of a year.

When to talk to a lawyer

A Latvian CASP application is won in the preparation: the entity, the substance, the scope and the package you put in front of Latvijas Banka. If you are weighing a MiCA licence, it is worth structuring all of that — and testing honestly whether Latvia is the right fit — before you file rather than after. You can get in touch or read more about how we work as crypto lawyers in Latvia. Related reading: DAC8: Crypto-Asset Reporting in the EU and Crypto Tax in Latvia 2026.

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Updated: 18 June 2026. Informational only and not individual legal advice.