The liberal attitude towards cryptocurrencies and the ease of reduced bureaucracy make the Czech Republic a welcoming home for crypto companies, whose main task should be to comply with general legislation and meet the requirements of AML/CFT initially implemented by the EU. Despite the lack of regulation, some products and services can already be paid for in cryptocurrencies, which is an indicator of cryptocurrency adoption.

The Czech Republic's Central Bank (CNB) has general supervision of the financial markets in the Czech Republic. According to the authorities, cryptocurrencies are not legal tender. Crypto data stored on a blockchain is not a claim expressed in traditional national currency issued by the central bank, lending institutions or other payment service providers. Cryptocurrencies are not electronic money according to Section 4 (1) of the Payment Systems Act. They are also not money according to Section 2 (1) (c) of the Payment Systems Act. Instead, cryptocurrencies are classified as commodities.

Before you start your crypto activities in the Czech Republic, you can take advantage of the help provided by local initiatives. Various startups and incubators offer various supports related to crypto product development, marketing and sales. One of them is CzechInvest, a government agency that has the CzechStarter incubator program, which lasts for seven months and provides access to funding, as well as the opportunity to attend workshops and expert consultations.

The Blockchain Connection Association/Czech Alliance was established in 2018 to accelerate the promotion and development of blockchain technology across the country. The association also aims to combat fraud and eliminate corruption, which should increase confidence in innovative financial solutions.

The Crypto-Anarchist Institute was established by a nonprofit called Paralelni Polis to promote a decentralized economy, which includes the unrestricted dissemination of information and the widespread introduction of blockchain-based products and services such as cryptocurrencies.

All new and existing cryptocurrency companies have access to the FinTech CNB contact point, an optimized communication channel designed to improve the functionality of financial market participants with a focus on innovation. Crypto companies can seek regulatory advice by filling out the contact form, during which it is essential to explain why a particular product or service is considered a financial innovation. However, this should not replace a professional lawyer. If you wish to receive comprehensive legal advice, please contact us – we will be more than happy to provide guidance.

Crypto Legislation in the Czech Republic

<img loading="lazy" decoding="async" class="size-medium wp-image-5549 alignleft" src="/uploads/Cryptocurrency-Licence-in-Czech-Republic.svg" alt="Crypto license in Czech Republic" width="300" height="300" title="Cryptocurrency License in Czech Republic 2025 9" srcset="/uploads/Cryptocurrency-Licence-in-Czech-Republic.svg 150w, /uploads/Cryptocurrency-Licence-in-Czech-Republic.svg 300w, /uploads/Cryptocurrency-Licence-in-Czech-Republic.svg 1024w" sizes="auto, (max-width: 300px) 100vw, 300px" style="box-sizing: Despite the absence of a reliable national crypto regulatory framework that can adequately protect investors, Czech crypto companies are still subject to EU law, as stated in the CNB’s 2018 brief “Internet Payments and Cryptocurrency Security”.

The Czech Republic has harmonized its legislation with the EU’s Fourth Anti-Money Laundering Directive (4AMLD) and Fifth Anti-Money Laundering Directive (5AMLD), requiring cryptocurrency exchanges and crypto wallet providers to implement internal AML/CFT procedures such as KYC. In addition, the revised Czech legislation covers a wider range of crypto-related economic activities, as it applies to businesses that trade, store, manage or broker the purchase or sale of virtual currencies or provide other crypto-related services.

For AML/CFT purposes, a digital currency is defined as a digital unit that does not fall into the category of legal tender but is nevertheless accepted as a means of payment for products and services by persons who are not the issuers of the unit.

Every Czech company engaged in crypto-related economic activities must comply with the following laws regarding AML/CFT:

• Money Laundering Act (Law No. 253/2008 Coll.), which provides for measures to combat money laundering/terrorist financing

• The Criminal Code (Law No. 40/2009 Coll.), defines criminal acts

• International Sanctions Law (Law No. 69/2006 Coll.), which defines the rules for the implementation of international sanctions

The Financial Analysis Unit (FAU) is the main AML/CTF supervisory body, while the CBN is responsible for enforcing other financial market legislation. Currently, the authorities have not introduced any complex registration process for companies engaged in crypto-related economic activities, and entering the market is relatively easy.

Firms engaging in crypto-related activities should consider the following general laws governing financial services:

• Trade Licensing Act (Act No. 455/1991 Coll.)

• Banking Law (No. 21/1992)

• Capital Market Obligations Act (No. 256/2004)

• Management Companies and Investment Funds Act (Law No. 240/2013 Coll.)

• Insurance Law (No. 277/2009)

• General legislation can help cryptocurrency companies understand where their activities should sit within the current financial market regulatory framework.

General legislation requires the National Security Council to authorize the following types of economic activities related to cryptography:

• Trading with cryptocurrency derivatives – they have the characteristics of investment instruments, so trading with them requires the permission of an investment company

• Managing the assets of an investor fund that includes cryptocurrencies, whether the fund is offered to the general public or to a limited group of investors

• Transfer of funds in connection with the organization of a cryptocurrency exchange (e.g., when a person transfers non-cash or electronic money as part of the operation of a cryptocurrency exchange, such transfer has the characteristics of providing payment services, in particular, transferring funds from the customer accounts of the exchange to their designated payment accounts)

Types of Cryptocurrency Licenses in the Czech Republic

Currently, most crypto companies planning to conduct economic activities in the Czech Republic must obtain one of the usual trade licenses from the Trade License Register, which allows them to operate within the EU, including opening offices in any member state, without having to deal with extensive bureaucracy, but only if they notify local authorities in accordance with local regulations.

Activity Category:

• Transactions that require notification may be processed immediately upon receipt of notification.

• If certain conditions need to be met (such as relevant professional experience or education), authorized activities can be carried out under the concession of a special business license

Depending on the purpose of using cryptocurrency, companies can apply for any of the following licenses:

• Classic – Paid shared cryptocurrency

• Fiat Currency – Commission exchange between cryptocurrencies and fiat currencies

• Traditional – Various currency exchange intermediaries

• Professional – Specific crypto-related products and services (crypto wallets, crypto client keys, etc.)

If a cryptocurrency company does not obtain the proper license, it risks being labeled a fraudster, fined up to 500,000 Czech crowns (about 20,204 euros), and forced to close.

advantage

How to Start a Crypto Company in the Czech Republic

To obtain one of the four licenses, crypto companies must register in the Czech Republic. A Limited Liability Company (SRO) is one of the most popular legal corporate structures in the Czech Republic, offering advantages such as low minimum share capital requirements, a small number of founders, and exemption from financial audits. It can be registered within three weeks if all necessary documents are submitted in a timely manner.

Main requirements of crypto companies:

The main steps to enable SRO for encryption are:

• Verify the name of your new company

• Receive a criminal record statement from the competent authorities, certifying that there are no obstacles to engaging in cryptocurrency-related economic activities

• Obtain a legal address for at least one year

• Opening a corporate bank account

• Minimum share capital for transfer is only 1 CZK (approx. 0.04 EUR)

• Obtain a compulsory trade license from the Trade License Registry

• Preparation and notarization of creation contracts

• Pay the state fees associated with the registration – 6000 CZK (approx. 243 EUR)

• Registration of the company in the registers of enterprises and tax authorities

• Register your company with the FAA for AML/CFT reporting purposes

All necessary documents must be submitted in Czech. If you need a certified translator, our team at (RUE) will be happy to help you.

You can also opt for remote company formation, in which case you will need to sign a power of attorney allowing your representative to act on your behalf throughout the process of creating your cryptocurrency company.

Cryptocurrency Licensing Process in the Czech Republic

Since there are no cryptocurrency-specific licenses in the Czech Republic, companies planning to engage in cryptocurrency-related economic activities must follow the general authorization procedure prescribed by the Trade License Register. The cryptocurrency licensing process can take up to four months and includes the formation of the company.

Generally, a cryptocurrency company must submit an application in Czech to one of the General Trade Offices containing all the basic information about the company and its founders (shareholders). It should be accompanied by a business plan (including both strategic and operational) and various background documents.

Applications can be submitted online using a secure electronic signature and sent to the central electronic filing office of the Commercial Registry. Submissions are processed by the competent trade licensing office designated by the applicant.

The evaluation of the application may include sharing information with foreign regulators. If the application is successful, a license will be issued only for specific cryptocurrency activities. It is worth noting that sometimes the license may be conditional, which means that the new licensee may need to meet additional conditions before starting to operate in the Czech Republic.

Once a cryptocurrency company is licensed in the Czech Republic, the licensee is obliged to share relevant reports (such as customer information) with authorities such as the CNB and FAU. In case of errors or denials, the license may be suspended and a new license may not be obtained, as such a company will be considered a fraud.

Crypto Taxation in the Czech Republic

Regardless of which trading license you choose to apply for, your cryptocurrency company will become a regular taxpayer in the Czech Republic. Taxation is enforced by the tax authorities. The tax year coincides with the Gregorian calendar year, but businesses can choose the fiscal year as the tax year.

The tax regime for crypto companies varies depending on the purpose of the crypto activity, but is no different than other businesses unless specific legislation is enacted by the EU. For example, the Court of Justice of the European Union (CJEU) has ruled that cryptocurrencies such as Bitcoin are considered traditional currencies for VAT purposes, and therefore cryptocurrency exchange services (cryptocurrency for fiat currency and vice versa, and cryptocurrencies for fiat currency, and cryptocurrencies for other cryptocurrencies) are exempt from VAT.

Companies that provide all types of crypto products and services must register as VAT taxpayers. The tax payment period for newly registered VAT taxpayers is one calendar month.

Standard rates in the Czech Republic:

• Corporate Income Tax (CIT) – 19

• Branch Tax (BT) – 19%

• Capital Gains Tax (WCL) – 0%-19%

• Value Added Tax (VAT) – 21

• Social Security (Senior Vice President) – 24.8

• Medical Insurance (SA) – 9

Resident companies are taxed on their income, while non-resident companies are taxed only on income earned in the Czech Republic. If a company is headquartered in the Czech Republic, it is considered a resident taxpayer. Taxable income is calculated based on accounting profit according to Czech accounting rules.

Cryptocurrency licensees and their partners must ensure that they can operate within the existing tax system despite the novelty of their activities. For example, the following rules should be considered:

• If employees are paid in cryptocurrencies, they and their employers are obliged to pay general taxes

• While cryptocurrency companies may be exempt from VAT when there is no supplier-customer relationship, their operating fee income is generally taxable at standard corporate income tax rates.

• If ordinary product and service providers are paid in cryptocurrencies, they are taxed the same way as those who are paid in fiat currencies.

Although cryptocurrency-related economic activities are largely unregulated in the Czech Republic, using cryptocurrencies to evade taxes or unconsciously disregarding tax rules will certainly lead to prosecution, as the Czech government has made it a priority to eliminate tax evasion through the anonymity of cryptocurrency owners. If you want to gain a clear understanding of the tax obligations of your cryptocurrency company, our tax experts will be happy to advise you.

The good news is that crypto licensees can also access existing tax benefits and incentives. For example, eligible Czech crypto companies may be able to benefit from the R&D tax credit, where up to 100% of the relevant R&D expenses incurred during the tax year is deducted from the tax base as a tax credit. This means that for tax purposes, the expenses are deducted twice - as normal tax-free expenses and as a tax credit for R&D. In addition, if the qualifying expenses in the current tax year exceed those in the previous year, an additional 10% can be added as a supplement.

Reporting requirements

Cryptocurrency licensees should be aware that they should continually meet strict corporate reporting requirements that closely match the International Financial Reporting Standards (IFRS).

Annual financial statements must contain a balance sheet, profit and loss statement and notes. Companies that must provide audited financial statements must provide a cash flow statement and a statement of changes in equity. Annual financial statements are published in the Commercial Register and must be filed together with the tax return.

Audits are mandatory for companies that meet at least two of the following criteria:

• Turnover more than 80 plants. CZK (approx. 3,234,413 EUR)

• Total assets: more than 40 plants. CZK (approx. 1,617,206 EUR)

• The average number of employees is more than 50

If you decide to obtain a cryptocurrency license in the Czech Republic, our experienced and dynamic team at (RUE) will be at your service to guide you through the entire process. We provide assistance with cryptocurrency company formation and licensing, as well as accounting services. In addition, we are happy to advise on tax and corporate reporting. Rest assured that we guarantee efficiency, confidentiality, and meticulous attention to every detail that affects the success of your business. Contact us today to schedule a personalized consultation.