While a fair amount of hand-wringing has been done across the European continent regarding the regulation of the cryptocurrency industry, there are a few countries who have seized the blockchain boom with opportunistic fervor. We often hear about places like Malta, Gibraltar, and Switzerland attracting hosts of blockchain firms; one of the blockchain-friendly countries that we don’t hear about quite as often, however, is Lithuania.
Lithuanian Economy Gets a Boost from Crypto Firms
Politico reporter Joanna Plucinska wrote that from a regulatory perspective, the country has welcomed the blockchain industry with open arms. This has paid off quite well for the small nation, which has a population of roughly 2.9 million people. Over the last twelve months, an estimated €500 million has been raised through ICOs and blockchain firms in Lithuania.
As a partial result of this influx of cash, the Lithuanian economy is estimated to grow by 3.1 percent by the end of this year, 0.8 percent ahead of the rest of the EU. In fact, the country is so bullish on blockchain that the Express reported that it has been upgrading its internet networks to “support data-heavy operations” like those involved in maintaining blockchain networks.
A Patchwork of Regulatory Attitudes Across the EU
However, the Lithuanian government isn’t taking a completely Laissez-Faire approach to cryptocurrencies. In April, the Lithuanian central bank reportedly began a conversation between banks, regulators, and traders in the country to discuss issues like money laundering and scams within the crypto space.
Following the dialogues, a complete set of regulations for ICOs and cryptocurrency were published by the Lithuanian finance ministry in mid-June. Although the guidelines included measures to tax cryptocurrencies and ICOs, and placed some limitations on the industry, the guidelines are still regarded as favorable in comparison to some other EU countries that have taken a more restrictive stance.
Lithuania’s welcoming attitude toward cryptocurrency may have made the country the basis for at least one crypto scam. Prodeum, a fake cryptocurrency startup, claimed that it was based in Lithuania before vanishing from the internet entirely, reportedly leaving nothing but the word ‘penis’ on a white background where its website used to be.
Fearing similar scams, the EU took action to regulate cryptocurrencies on a large scale in April this year when the European Parliament voted to support an agreement with the European Council to place regulations on cryptocurrencies that would prevent them from being used in money laundering and terrorism financing.