The application for regulatory approval should not contain the words “We are setting up a platform for cryptocurrency”.

Will customers exchange cryptocurrency against fiat? Does the platform permit the transfer of virtual assets? The company will have control over the wallets of clients as well as private keys? Is it managing the trading platform and crediting against digital assets or planning to issue tokens?

These differences matter when seeking a cryptocurrency license to operate in Georgia. The kind of services the company plans to provide affects its regulatory preparation, documents control, documents, and capital requirements.

Georgia offers a market that is regulated for virtual assets, which is appealing to fintech companies. However, gaining access to this market requires much more effort than just registering your business and then launching your website.

Defining the term “service”

Companies that provide virtual assets services to third parties are required to become Virtual Asset Service Providers with the National Bank of Georgia under the guidelines laid out by PB Services.

Within the scope are actions like virtual transfer and exchange of assets along with management of trading platforms and the management of crypto assets or custody. The information on regulation states that the concept of custody extends to the administration of the private keys of the client or the wallet.

This means that the design of an crypto-product important to its regulation status.

A founder interested to obtain a crypto licence in Georgia must sketch out the customer journey proposed before formulating the request. What happens after a client makes a deposit? Who controls the account? The assets can be transferred or exchanged? Who is the party that is able to authorize a transaction?

Clear answers help establish what the firm will be doing.

Your business plan must describe the real-world business

VASP applications require more than a visually attractive pitch deck.

Based on the information provided, the National Bank expects a detailed business plan, which includes projections of financials for at least three years, which includes costs, revenues, and growth forecasts. The plan must also demonstrate that there is a genuine intention to be operational within Georgia.

It is important to address this issue as quickly as you can.

A business plan written to be used by investors addresses questions about how quickly the company’s growth rate can be accelerated. The business plan of any regulatory activity must contain information about how the operation will be conducted responsibly.

For companies seeking a vasp license Georgia applicants should be prepared to connect the commercial model with the compliance model rather than treating them as unrelated documents.

AML cannot be added at the very end

PB Services describes the preparation as a series of steps that cover anti-money laundering, as well as control of financing for terrorism.

The supplied material specifically warns that simply importing an AML policy from another country is insufficient because Georgian laws must be incorporated into the company’s framework.

The operational systems are important also. The business plan needs to be able to demonstrate that the business’s system can identify potentially suspicious and related transactions.

Practically speaking it is essential that compliance be a factor in the design of a product prior to launch. By creating a platform, then deciding on the way AML will work and how it will work, you could cause unnecessary delays and redesign.

The Services You Choose Can Change Your Capital

Regulatory capital is another reason to identify the business model before.

Based on the thresholds set in the documents, kiosks and exchange activities need 150 000 GEL. Trading-platform administration needs 350,000 GEL and other services need 250,000 GEL. The highest threshold applies for multiple services.

It’s not the same as operating capital that is used for normal purposes. Documentation that proves the required amount was actually paid for must be submitted with the application and the capital needs to be maintained throughout the course of operations.

Anyone who wants to get a the crypto blockchain license in Georgia should therefore think about regulatory capital as part of financial planning not after the rest of the application has been completed.

Registration doesn’t finish the compliance process.

The compliance calendar does not end when you have approval. The provided requirements outline ongoing obligations involving risk management, cybersecurity technology and fraud risk, as well as records retention, independent reviews and complaints from customers.

A framework for risk management such as a risk management framework, for instance, is required to receive an opinion from an independent auditor within 12 months from the date of registration. The described complaint-handling rules also require companies to accept complaints in oral, written, or electronic form, analyze them within a maximum of a month, and provide data on complaints electronically to National Bank each month.

These particulars affect the manner serious applicants should apply for licensing.

Instead of thinking of the Georgian VASP application as a collection of forms that must be completed to get permission imagine it as the design of the business that is regulated.

A company’s structure, service model, and technological capabilities, AML controls as well regulatory capital, risk procedures and customer service processes have to be coherent.

Georgia remains a wonderful place for fintech and crypto companies. The regulatory framework it has provides an established path to market. The best way to begin is to not ask about how fast a license can come through.

You must be able explain in detail how your business’s crypto-related activities will be, and demonstrate that you’re able to comply with Georgia’s rules.