How much will you spend on a crypto license in Canada?
Canada is one of the most attractive jurisdictions for financial activities. It is due to loyal state requirements about firms and ensuring high rights protection. Two types of financial institutions must comply with the PCMLTFA: FMSB and MSB. Regardless of your chosen format, you must obtain a crypto license in Canada. We want to discuss how much it might cost and tell you more about this jurisdiction.
Which activities are related to MSB?
An organization will be classified as an MSB if it engages in the following financial activities. A company that provides only one MSB service:
- conducting foreign exchange transactions;
- financial transfers;
- intermediary services between legal entities or individuals;
- intermediary services between the payer and the recipient (excluding debt payments).
An organization that makes money transfers, issues or cancels traveler’s checks, etc. (excluding check cashing). A company providing services related to virtual currency:
- fiat to cryptocurrency exchange;
- exchange of cryptocurrency for another crypto;
- transfer or receipt of crypto;
- crowdfunding services.
Your organization is engaged in financial business directly in Canada, has an actual office in this country, has Canadian employees, and has a branch here.
Your organization is registered and licensed and provides one of the services listed above or is engaged in attracting clients to the listed services.
What activities are related to the company FMSB?
An organization will be classified as an FMSB if classified as an MSB but simultaneously be in the following situations.
Your organization needs a Canadian registration, a physical office, and Canadian employees employed.
Your firm provides services in Canada: marketing, advertising, management of the Canadian “.ca” domain, or your organization is listed in the Canadian business directory.
Your organization provides services to Canadian clients, corresponding to the following indicators: residence permit, Canadian documents, Canadian bank cards, place of work or study, and vacationers in Canada.
Which company will not be classified as either an MSB or an FMSB?
Consider under what circumstances your firm would not fall into either of the two categories of financial institutions.
If you only act as an agent, providing one or more services, the entity people work on behalf of must be registered.
If you are operating an MSB while providing other services, your organization reports to the competent authorities.
MSB Licensing Requirements
To be licensed, several conditions must be met, which we will discuss below. It would be best to have a real FINTRAC registered office in Canada. Your firm must fully comply with the PCMLTFA requirements, considering all possible risks, and a responsible person must be appointed to comply with these rules. It is also essential to maintain confidentiality and maintain company records regularly.
All management staff must have certificates of no criminal record in the country in which he is a citizen. And one of the leaders must have an education in the financial sector.
MSB Licensing Process
After about 2-3 months, the company will receive registration, and after that, it will take about 3 weeks to start financial activities and open a bank account.
Collect a package of documents (2 weeks)
It is necessary to provide the required package of documents, business plan, and company budget for preliminary analysis. You should also consider all the requirements of PCMLTFA and prepare KYC.
Register a company (1.5 months)
To do this, you must choose the company’s name, rent an office (lease agreement), and decide on the authorized capital. Next, prepare all corporate documents (notarized) and train a staff of personnel with financial experience.
Open a bank account (1 month)
Prepare notarized documents and conduct initial negotiations with the bank, discussing the conditions for opening an account. Then deposit the authorized capital into the account.
Preliminary activities and company registration (2 weeks)
Provide adapted documents required for cryptocurrency activities (AML/CTF). Select experienced employees and, if necessary, conduct training. Apply for licensing. Additional documents for FINTRAC may also be required.
If you want to know how much it will cost to get an crypto license in Canada, seek professional help from experienced Gofaizen&Sherle specialists who will answer your questions and provide assistance in licensing.
