Manimama Law Firm provides a gateway for the companies operating as the virtual asset wallet and exchange providers allowing to enter to the markets legally. We are ready to offer an appropriate support in obtaining a license with lower founding and operating costs. We offer KYC/AML launch, support in risk assessment, legal services, legal opinions, advice on general data protection provisions, contracts and all necessary legal and business tools to start business of virtual asset service provider
General process of obtaining a crypto license:
- Gathering necessary documents.
- Company registration.
- Preparing and ensuring compliance with AML/KYC rules.
- Interacting with local registries and obtaining the license.
- Opening corporate accounts.
Choose your country for more information:
Searching for the best jurisdiction for VASPs
Regulation of the cryptocurrency market is constantly becoming stricter. Nowadays, USA, UAE, Canada, and other jurisdictions impose high regulatory and risk management requirements on virtual asset service providers. Despite this, we always manage to find a solution that suits the client. All the time our team provides research of the market and regulations on various markets to find the best jurisdiction.
Lowest taxes:
British Virgin Islands
Cayman Islands
Seychelles
Fastest registration
Canada
No requirement for initial capital:
Canada
British Virgin Islands
Cayman Islands
Georgia
The most popular:
Switzerland
The ability to provide other financial activities besides dealing in virtual currency:
Canada
Switzerland
Seychelles
Reputable offshore license:
British Virgin Islands
Cayman Islands
Seychelles
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Full support
We offer full support during and after a project, ensuring you have the resources you need to succeed
Legal opinion about cryptocurrency licensing
Ganna Voievodina
Manimama
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CEO
“Let’s face it, cryptocurrency regulations can seem like a foreign language. In this dynamic and sometimes unpredictable market, a crypto license is your trusty translator, ensuring you stay fluent in the ever-changing world of digital assets. Don’t get left behind – securing a license is essential for navigating this landscape successfully”
Why cryptocurrency licensing is important
Despite all pros and cons, regulation of cryptocurrency activities around the globe is an important thing. While holding of cryptoassets on private accounts may not be harmful for the society and economy, providing services by various companies to customers in virtual assets sphere may be a threat due to the complex nature of crypto. All of us remember the first times when crypto was invented. Many criminals managed to use it for illegal activities as a payment method. And this is a point when cryptocurrency licensing enters the game. Many businesses thrive when using cryptocurrency in their day-to-day operations even if they do not execute activities with crypto itself
In the dynamic world of financial services, the advent of cryptocurrencies has revolutionized the way companies conduct business. The blockchain technology that underpins crypto has offered a new paradigm for exchange operations, capital flow, and financial transactions. However, this burgeoning market is not without its complexities. As the crypto environment continues to evolve, so too does the regulatory landscape that governs it
- Companies venturing into the crypto market must navigate a labyrinth of regulatory requirements. These regulations vary from country to country, each with its unique approach to crypto licensing. The process of obtaining a license involves a meticulous examination of the company’s business model, financial stability, and compliance mechanisms
- The licensing process is not merely a bureaucratic hurdle. It is a crucial step that ensures the company’s operations align with the regulatory standards of the country in which it operates. A crypto license offers a seal of credibility, assuring customers and investors of the company’s commitment to compliance and ethical business practices
- Obtaining a crypto license is not a straightforward task. It involves the submission of numerous documents, a thorough understanding of the regulatory requirements, and a commitment to maintaining high standards of operation and service
- The application for a crypto license requires a detailed description of the company’s business model, its financial projections, and its plans for ensuring compliance with regulatory requirements. The company must also provide information about its blockchain technology, its development plans, and its strategies for managing capital and financial risks
- The licensing process also requires companies to demonstrate their understanding of the crypto market and its potential risks and rewards. They must show that they have a robust risk management strategy in place and that they are prepared to adapt to changes in the regulatory environment
Importance of cryptocurrency license is defined by market growth. It can give you stability, developing of business through increasing trust from the client to your business
Understanding cryptocurrency licensing
Cryptocurrency, a revolutionary digital asset class, has disrupted traditional financial paradigms, ushering in a new era of value transfer and financial inclusion. As this dynamic ecosystem continues to evolve, the role of regulatory bodies becomes increasingly critical. In this comprehensive discourse, we delve into the intricate world of cryptocurrency licensing, elucidating its definition, regulatory nuances, and the diverse licenses essential for crypto businesses
Definition
Cryptocurrency licensing refers to the legal authorization bestowed upon entities operating within the crypto sphere. These licenses serve as gateways, permitting companies to conduct business while adhering to legal frameworks. Proper licensing ensures consumer protection, market integrity, and financial stability. Failure to obtain appropriate licenses exposes businesses to legal jeopardy, financial penalties, and reputational harm
The role of regulatory bodies
Regulatory bodies play a pivotal role in shaping the crypto licensing landscape. Their mandate is twofold: to foster innovation while safeguarding public interests. These bodies monitor the crypto market, assess risks, and design licensing frameworks aligned with their country’s legal and economic context. Their delicate balancing act ensures that crypto businesses operate transparently, minimizing illicit activities and promoting investor confidence
Cryptocurrency license is a type of permit which issued by regulatory body in the country. It is often called VASP license
Types of cryptocurrency licenses
Exchange licenses
Crypto exchanges, the backbone of the digital asset ecosystem, require licenses to operate legally. These licenses authorize exchanges to facilitate buying, selling, and trading of cryptocurrencies. Regulatory scrutiny ensures compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations
Wallet service provider licenses
Wallets, whether hardware or software-based, enable secure storage and management of crypto holdings. Licensing ensures adherence to security protocols, user fund protection, and transparency
Payment processor licenses
Businesses accepting cryptocurrencies as payment need payment processor licenses. These validate their ability to seamlessly process crypto transactions, bridging traditional and digital payment systems
Token issuance licenses
Companies launching initial coin offerings (ICOs) or security token offerings (STOs) must obtain token issuance licenses. These validate project legitimacy, assess compliance with securities laws, and safeguard investors
Crypto custodian licenses
Custodians safeguard digital assets on behalf of clients. Obtaining a crypto custodian license involves rigorous security audits, risk assessments, and capital compliance
Blockchain development licenses
Entities engaged in blockchain development, whether for public or private networks, require licenses. These cover creation, maintenance, and enhancement of blockchain protocols
Broker-dealer licenses
Crypto broker-dealers facilitate over-the-counter (OTC) trading and provide liquidity. Licensing ensures adherence to market integrity standards and investor protection
Types of activities with cryptocurrency licenses
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Exchange cryptocurrencies for cryptocurrencies
VASPs have the right to conduct exchanges between various virtual assets, including utility tokens and coins. This means that when a user has one cryptocurrency, such as Bitcoin, and wants to exchange it for another cryptocurrency, such as Etherium, he will be able to do so through VASP
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Exchange cryptocurrency for fiat and fiat for cryptocurrency
VASP has the right to convert cryptocurrency into fiat currencies and vice versa, which opens up new business opportunities. If a user wants to exchange their cryptocurrency for regular money such as dollars or euros, or vice versa, exchange their regular money for cryptocurrency, VASP will help do this
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Token Sale
VASPs have the right to conduct ICOs, offering e-money tokens with limited use. If a user wants to launch his own project and raise money through an ICO (Initial Coin Offering), VASP will help him carry out this operation and sell his tokens to other people
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Cryptocurrency transfers
VASPs have the authority to provide secure transfers of cryptocurrencies from clients’ wallets to designated third-party wallets, providing an alternative to traditional bank transfers.
If a user wants to send cryptocurrency to someone else, VASP will help do it safely and quickly, just like sending money through a bank, but using cryptocurrency -
Cryptoprocessing and cryptoacquiring
VASPs have the ability to provide services that allow merchants to accept cryptocurrency as payment for goods or services and then convert or convert it into fiat money. If the user is a seller and wants to accept cryptocurrency as payment for goods or services, VASP will help do this, as well as convert cryptocurrency into regular money
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On-ramp and off-ramp services
VASPs have extensive business development opportunities, including providing B2B services in the form of on-ramp, off-ramp and white label products, which Manimama is ready to help launch. This means that if a user wants to start his own cryptocurrency business, VASP will help him with various services to make his business successful
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Custodial wallet services
VASPs have the ability to open custodial wallets while maintaining control of the private keys. This means that if the user wants to store their cryptocurrencies in a safe place, VASP can provide a special wallet where the user will control their cryptocurrencies
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Issuance of account statements
VASPs have the right to display balances and issue statements of accounts and transactions. If a user wants to know how much cryptocurrency they have in their account or view their transaction history, VASP can provide all this information in a special statement, like bank statements
Who can be your client?
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Individual investors
People who want to exchange one cryptocurrency for another or convert their cryptocurrencies into regular money. They can use VASP services to manage their investments and finances
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Cryptocurrency holders
Users who want to store their cryptocurrencies in a safe place can turn to the custodial wallet services provided by VASP
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Sellers and entrepreneurs
Businesses that want to accept cryptocurrency as payment for their goods and services can use VASP services to process payments and convert cryptocurrency into regular money
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Businesses related to cryptocurrencies
Companies and startups that want to launch their own cryptocurrency project or conduct an ICO can use VASP services to obtain the necessary support and legal assistance
Why is AML crucial for cryptobusiness?
Anti-Money Laundering (AML) encompasses a wide range of laws and procedures designed to disrupt the flow of illegal funds and prevent financing for terrorist activities. Cryptocurrency companies, due to the unique nature of digital assets, must adhere to strict AML standards. These include:
Customer identification (KYC)
Cryptocurrency companies must implement robust processes to verify the identity of all their customers. This can involve collecting personal information, verifying documents, and potentially using advanced biometric identification methods. The goal is to prevent criminals from disguising their identities and using the platform for illicit purposes.
Transaction monitoring
Crypto platforms must utilize sophisticated monitoring systems to analyze all transactions. This includes flagging unusual patterns, large transfers, or transactions connected to high-risk jurisdictions. These monitoring systems help identify potential attempts to launder money or finance terrorism.
Risk-Based approach
Understanding risk is key to effective AML compliance. Companies need to assess their specific vulnerabilities based on factors like customer profiles, geographic locations, and the types of cryptocurrencies offered. Once risks are identified, proportionate controls and mitigation strategies should be implemented.
Internal policies
Detailed internal policies and procedures serve as a roadmap for AML compliance. These policies should outline responsibilities, reporting procedures, record-keeping practices, and how to handle suspicious activities.
Training and education
Employees at all levels should receive comprehensive AML training. They need to understand the risks, red flags of suspicious activity, reporting obligations, and the company’s specific policies.
Record retention
VASPs Secure record-keeping is essential for potential investigations. Companies should meticulously store customer identification data, transaction details, and other relevant information for a period mandated by regulators.
Reporting
Crypto companies must file various reports with regulatory agencies such as Suspicious Activity Reports (SARs) when unusual transactions are detected. Regulators rely on these reports to track patterns and investigate potential criminal activity.
Building trust with customers and stakeholders
Trust is the bedrock of any business relationship. Cryptocurrency licenses signal transparency, accountability, and legitimacy. Customers and stakeholders, wary of the crypto market’s volatility, seek assurance that their transactions occur within a regulated framework. Licensed companies inspire confidence, fostering long-term relationships and market stability.
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Transparency
Licensed companies operate within a regulated framework, disclosing essential information to customers. Transparency inspires confidence, especially in a market known for its volatility.
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Accountability
Licensed entities are accountable to regulatory bodies. They adhere to ethical standards, preventing fraudulent practices. Customers and stakeholders appreciate this commitment to responsible conduct.
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Legitimacy
The crypto market has witnessed its share of scams and unscrupulous operators. Licensed businesses stand out as legitimate players, reassuring customers that their investments are secure.
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Long-Term Relationships
Trust fosters long-term relationships. Licensed platforms attract loyal customers who value security and compliance. Stakeholders, including investors and partners, prefer licensed entities for sustained collaboration.
Mitigating risks associated with illegal activities
Cryptocurrencies, while transformative, are susceptible to misuse. Money laundering, terrorist financing, and other illicit activities pose significant risks. Licensing mandates compel companies to implement robust AML and KYC measures. By scrutinizing transactions, monitoring suspicious activities, and reporting anomalies, licensed entities contribute to a safer crypto ecosystem.
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Money laundering
Licensed entities implement robust AML measures, preventing money laundering. By monitoring transactions and reporting suspicious activities, they contribute to a clean crypto ecosystem.
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Terrorist financing
Cryptocurrencies can inadvertently fund illicit activities. Licensing mandates compel businesses to scrutinize transactions, ensuring that funds do not flow to terrorist organizations.
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Fraud and scams
Unlicensed platforms often perpetrate scams, defrauding unsuspecting investors. Licensing weeds out fraudulent operators, protecting investors and maintaining market integrity.
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Consumer protection
Licensed companies prioritize consumer protection. They adhere to regulations, safeguarding user funds and ensuring fair practices. Investors trust licensed platforms to uphold their rights.
The process of opening VASP business
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Business assessment and planning
Business evaluation
You need to begin by assessing your business structure, financial stability, and operational capacity. To start new business, you need to have at least an idea and simple way of making customers in order to save your funds and time.
Market research
understand the cryptocurrency market in your chosen country. Identify gaps, potential competitors, and unique offerings your project can provide.
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Documentation and application preparation
This step is crucial There is your license obtaining way begins. Contact our lawyers to make sure all thing are done correctly. This step includes:
Legal check
We verify the legitimacy of the company. How long has it been in business? Is it incorporated? Any history of lawsuits? It is crucial to understand your background to choose proper strategy
Financial check
We need to obtain financial statements for the past periods. These statements demonstrate the licensee’s financial strength to the regulator. Then you need to conduct a credit check to assess payment reliability.
Business Check
Then you need to evaluate the company’s reputation within the selected product category. Research their existing brand licenses and feedback from licensors. After that we can prepare business plan that is usually demanded by the regulator.
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Submission and review
Application submission
We submit the completed application along with all required documents to the relevant regulatory authority and ensure accuracy and completeness.
Review process
The regulatory body reviews the application. This stage involves due diligence, including legal, financial, and risk assessments. Expect inquiries and clarifications during this phase.
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Licensing decision and compliance
Approval or rejection
Based on the review, the authority grants or denies the license. If approved, congratulations! If rejected, address any deficiencies promptly.
Compliance commitment
Once licensed, adhere strictly to the terms. Regular reporting, audits, and compliance checks are standard
Challenges in cryptocurrency licensing
Cryptocurrencies have revolutionized the financial landscape, offering decentralized and borderless transactions. However, navigating the regulatory environment remains a complex endeavor for companies operating in this space. In this discussion, we delve into the challenges faced during the cryptocurrency licensing process and explore strategies to overcome them.
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Regulatory complexity and shifting landscape
Obstacle
The regulatory framework for cryptocurrencies varies significantly across countries. Some nations embrace digital currencies, while others remain cautious or even hostile. Companies must grapple with ever-evolving regulations, making compliance a moving target.
Strategy
Stay informed about regulatory changes in your target markets. Engage legal experts who specialize in blockchain and cryptocurrency law. Develop a robust compliance program that adapts swiftly to shifting requirements.
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Technical Competence
Obstacle
Licensing authorities scrutinize the technical aspects of cryptocurrency projects. Companies must demonstrate their ability to operate secure and efficient platforms. Lack of technical expertise can hinder the licensing process.
Strategy
Assemble a skilled development team with expertise in blockchain, cryptography, and smart contracts. Conduct thorough testing and security audits. Showcase your technical prowess in the licensing application.
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Operational Challenges
Obstacle
Running a licensed cryptocurrency exchange or wallet service involves continuous monitoring, security enhancements, and customer support. Companies must ensure seamless operations while adhering to regulatory obligations.
Strategy
Invest in robust infrastructure and cybersecurity measures. Implement automated compliance checks. Provide excellent customer service to build trust and retain users.
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Legal Uncertainties
Obstacle
Legal interpretations of cryptocurrency-related laws are still evolving. Companies face uncertainties regarding tax treatment, liability, and jurisdictional issues.
Strategy
Consult legal experts who specialize in cryptocurrency law. Stay updated on court rulings and regulatory guidelines. Mitigate risks by seeking legal clarity.
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Documenting Compliance
Obstacle
Licensing applications demand extensive documentation. Companies must provide detailed information about their business model, security protocols, anti-money laundering (AML) procedures, and customer protection measures. Crafting comprehensive documents can be time-consuming and resource-intensive.
Strategy
Collaborate with legal and compliance teams to create well-structured documents. Highlight your commitment to AML and Know Your Customer (KYC) procedures. Clearly articulate your security measures and risk management protocols.
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Capital Requirements
Obstacle
Licensing often comes with capital adequacy requirements. Startups and small businesses may struggle to meet these financial thresholds. Raising sufficient capital while adhering to licensing prerequisites poses a significant challenge.
Strategy
Explore funding options such as venture capital, initial coin offerings (ICOs), or private placements. Demonstrate your financial stability and commitment to long-term growth. Consider partnerships or joint ventures to pool resources.
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Market Entry Barriers
Obstacle
Some countries impose stringent entry barriers for cryptocurrency exchanges and service providers. These barriers include minimum user base requirements, operational history, and cybersecurity standards.
Strategy
Research the specific requirements of your target country. Establish partnerships with local entities to navigate cultural nuances and regulatory hurdles. Gradually build your user base while maintaining compliance.
Role of licensing in crypto business development
The crypto market is a rapidly evolving environment, with blockchain technology offering a myriad of opportunities for business development. A crucial aspect of this development process is licensing, which plays a significant role in shaping the operation and growth of a crypto business.
Licensing
Licensing is a regulatory requirement that crypto businesses must adhere to in order to operate within a specific country or region. It involves a comprehensive process where a company applies for a license to offer crypto services, such as operating a crypto exchange or offering a blockchain-based project. The licensing process involves the submission of various documents to regulatory authorities, demonstrating the company’s compliance with financial regulations and laws.
The impact of licensing
The impact of licensing on the operation of a crypto business is profound. It provides a framework within which the company can operate, ensuring compliance with the regulatory environment of the country. This compliance is not just a requirement, but also a marker of credibility and reliability in the market. A licensed crypto business is more likely to gain the trust of customers, partners, and investors, fostering an environment conducive to growth and development.
New avenues for a crypto business
Moreover, licensing can open up new avenues for a crypto business. For instance, a company with a license to operate a crypto exchange in a particular country can tap into the crypto market of that country, offering its services to a potentially large customer base. This can significantly boost the company’s growth and expand its operations.
Impact of licensing on attracting capital and investments
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Licensing as a signal of trust and legitimacy
Obtaining proper licensing demonstrates a crypto business’s adherence to regulations and promotes a sense of financial transparency. This signals to investors that the company is trustworthy and operates legitimately.
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Licensing streamlines capital access
Licensed crypto companies gain better access to crucial financial services like banking and payment processing. This smooths the path for handling investments and managing funds.
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Licensing attracts investors to specific projects
When raising funds for projects, a licensed crypto business highlights its compliance with regulations and operational permissions. This builds trust in specific projects and boosts investor confidence.
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Licensing’s overall importance
Licensing is not just a box to check, it profoundly shapes how a crypto business operates, scales, and secures funding. The evolving crypto market will likely place even more emphasis on licensing as a sign of reliability.
Understanding cryptocurrency licensing
The process of crypto licensing is expected to become more streamlined and standardized. As regulatory authorities gain a better understanding of the crypto environment, they can develop more effective and efficient licensing processes. This could involve simplifying the application process, reducing the amount of documentation required, or even automating certain aspects of the process using blockchain technology.
The scope of crypto licensing is also likely to expand. Currently, licensing primarily applies to crypto exchanges and certain types of blockchain projects. However, as the crypto market grows and diversifies, new types of crypto businesses may emerge that also require licensing. This could include companies offering innovative crypto services, such as decentralized finance (DeFi) platforms, blockchain-based supply chain solutions, or crypto payment gateways.
Furthermore, the regulatory environment for crypto businesses is likely to become more harmonized across different countries. Currently, the regulatory requirements for crypto businesses can vary significantly from one country to another. However, as the global nature of the crypto market becomes increasingly recognized, there may be a move towards more uniform regulations. This could involve the development of international standards for crypto licensing, which would make it easier for crypto businesses to operate across different countries.
The development of blockchain technology and market trends will also play a crucial role in shaping the future of crypto licensing. For instance, the growing trend towards decentralization in the crypto market could pose new challenges for licensing. Decentralized crypto platforms, such as DeFi platforms, operate in a way that is fundamentally different from traditional financial institutions. This could require regulatory authorities to rethink their approach to licensing, and develop new types of licenses that are better suited to these decentralized platforms.
The future of crypto licensing promises streamlined processes, broader regulation across business types, and potential global standardization
Blockchain technology itself could also be used to enhance the licensing process. For example, blockchain could be used to create a transparent and tamper-proof record of all licenses issued. This would make it easier for regulatory authorities to track and monitor licensed crypto businesses, and for potential customers and investors to verify a company’s licensing status.
In conclusion, the future of cryptocurrency licensing is likely to be shaped by a combination of regulatory developments, technological advancements, and market trends. As the crypto market continues to evolve, so too will the licensing processes and requirements that govern it.
Frequently asked questions
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What does Manimama Law Firm offer?
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What is VASP and why is it important?
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What services does Manimama Law Firm provide?
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Who are the services of Manimama Law Firm intended for?
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What benefits does a client receive when applying for the services of Manimama Law Firm?
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How is VASP different from other companies?
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What services can I expect after receiving my VASP license?
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What advantages does Manimama Law Firm provide over its competitors?
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What are the next steps after registering with Manimama Law Firm?
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How long does the process of obtaining VASP authorization with Manimama Law Firm take?
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What is a crypto license?
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How to register a crypto company?
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What is the validity period of the VASP license?
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Semen Kaploushenko
Deffio
|
CEO
“Having worked at Manimama OU for the past two years, I can confidently affirm that its legal expertise in fintech is unparalleled”.
Vadym Hrusha
Trustee Plus
|
Founder & CEO
“Manimama OU’s commitment to excellence and innovation in the legal field has made my professional journey incredibly rewarding.”
Yuriy Soshenko
WhiteBit
|
CLO
“If you seek a law firm that combines deep knowledge with a dynamic approach, Manimama OU stands out as a prime choice.”
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