Get a Crypto License in Germany

German cryptocurrency licensing system: The role of BaFin and MiCA

Germany has established itself as one of the leading destinations for cryptocurrency businesses in the European Union, especially after the full implementation of the MiCA (Markets in Crypto-Assets) regulation in 2024. MiCA is a pan-European legal framework aimed at harmonizing the regulation of crypto assets across all EU member states. It allows companies to operate in any member state with a single license through a passporting mechanism.

In Germany, licenses are issued by BaFin – the Federal Financial Supervisory Authority. It oversees compliance with both national and European legislation, including obligations under the FATF (Financial Action Task Force) – an international body developing measures to combat money laundering and terrorist financing. Particular attention is given to compliance with AML/CFT rules. Additionally, BaFin works closely with EU bodies, including the EBA (European Banking Authority), ensuring oversight of stablecoins, the activities of VASPs (Virtual Asset Service Providers), and adherence to financial transparency requirements.

As of 2025, the regulatory environment for cryptocurrency and blockchain companies in Germany is governed by MiCA, which marks a milestone in standardizing approaches to virtual assets and related services. The new framework enhances financial sector stability, protects consumer interests, and fosters innovation. As a result, a BaFin license enables operations not only in Germany but throughout the EU within a unified legal system.

Key functions and benefits of a German crypto license:

• legal operation throughout the entire European Union;
  
• unified regulatory standard under MiCA;
  
• supervision by the reputable regulator BaFin;
  
• compliance with international FATF standards and AML/CFT requirements;
  
• oversight of VASPs and stablecoins in cooperation with the EBA;
  
• sustainable regulation and a transparent legal framework;
  
• investor and partner trust in the German jurisdiction.

Germany has a limited but well-established legal framework for crypto activities and has developed a reputation as a reliable jurisdiction. Entrepreneurs launching cryptocurrency exchanges, custodial wallets, or planning token issuance (ICOs) can obtain legal legitimacy and access to the broader European market with a German license.

This guide has been prepared to provide an up-to-date overview of obtaining a crypto license in Germany, including the latest assessments of licensing practices and regulatory updates that came into effect in 2025.

Types of activities covered by a crypto license in Germany

According to the MiCA regulation, the crypto license issued in Germany by the supervisory authority BaFin covers a wide range of Crypto-Asset Services (CAS) – services related to crypto assets. Companies are required to obtain authorization for the following types of activities:

• Custody and administration of crypto assets – providing custodial services, including wallet management and storage of private keys.
  
• Operation of trading platforms – establishing and running cryptocurrency exchanges or platforms for the exchange of virtual currencies.
  
• Exchange services – currency exchange operations involving the conversion of fiat currencies into cryptocurrency and vice versa, as well as exchange between different crypto assets on licensed exchange platforms.
• Execution of client orders – executing transactions on behalf of clients (brokerage services).
  
• Placement of crypto assets – promoting and distributing tokens, including ICOs (Initial Coin Offerings) and STOs (Security Token Offerings).
  
• Reception and transmission of orders – receiving client instructions to buy or sell virtual currencies.
  
• Investment advice on crypto assets – providing recommendations regarding investments in virtual assets or tokens.
  
• Portfolio management – managing client investment portfolios that include cryptocurrencies.

Additionally, engaging in activities related to the issuance of asset-referenced tokens (ARTs) – tokens backed by a basket of assets – and e-money tokens (EMTs) – tokens equivalent to electronic money – also requires compliance with MiCA regulations.

Some additional areas, such as mining, smart contract development, and the implementation of DeFi projects (decentralized finance solutions), may fall under regulatory oversight depending on the nature and scale of the activity.

Moreover, tokens can be classified as:

• utility tokens – providing access to a product or service;
  
• security tokens – representing financial instruments or investment contracts;
  
• cryptocurrency tokens – used primarily as a means of payment.

This classification also affects permissible activities and whether a license or regulatory approval is required.

Advantages of the German jurisdiction for crypto business

Germany is recognized as one of the most attractive jurisdictions for establishing and operating a cryptocurrency business, thanks to several key advantages:

• Unified access to the entire EU
  A BaFin license grants the right to offer crypto services, sell, and distribute them across the entire European Union without the need for additional authorizations in other member states.
  
• Legal clarity
  The MiCA regulation and Germany’s national legislation, including the German Banking Act, clearly define the framework for cryptocurrency activities.
  
• Support for innovation
  Germany actively encourages startups and projects in the blockchain space. There are no significant barriers from the banking sector, making market entry easier for new players.
  
• Tax benefits
  The country offers a favorable tax regime: for example, capital gains on assets held for more than one year are taxed at a flat rate of 25%.
  
• Reliability and transparency
  Compliance with AML/CFT (anti-money laundering and counter-terrorism financing) standards enhances trust from clients, partners, and investors.
  
• Developed financial market
  Germany is a leader in the European financial sector. Banks, custodians, and other service providers are generally open to working with crypto companies.

Thanks to these conditions, Germany remains a reliable and efficient hub for registering, acquiring, or launching a cryptocurrency company.

Prifinance provides comprehensive support at every stage of launching a crypto business in Germany – from choosing a form and preparing documentation to obtaining a BaFin license and advising on taxation, AML/CFT compliance, and interactions with financial institutions.

Comparison with other jurisdictions

Germany’s licensing system in the field of cryptocurrencies is regulated in accordance with the MiCA (Markets in Crypto-Assets Regulation) framework and represents a unified regime for all companies operating within the European Union. This ensures a standardized and predictable approach to the regulation of crypto assets across the entire EU zone.

Below is a table comparing Germany’s regulatory framework with several other key jurisdictions: Estonia, Malta, Switzerland, and the United Kingdom.

Key takeaways

• Germany, Estonia, and Malta operate under a unified market regime as EU member states, adhering to the MiCA (Markets in Crypto-Assets Regulation). A single license allows access to the entire EU region under common requirements, significantly simplifying cross-border operations for blockchain companies.
• Switzerland is not part of the EU and operates under its own regulatory framework, which is geared toward supporting blockchain projects. However, a Swiss license does not grant automatic access to the EU – conducting business in EU countries requires additional regulatory compliance and obtaining separate authorizations.
• The United Kingdom, following Brexit, has developed its own cryptocurrency regulatory system. Similar to Switzerland, a UK license does not provide the right to operate in the EU market, and separate authorizations must be obtained in the respective jurisdictions.

What is required to obtain a crypto license in Germany: Full list of requirements

To obtain a crypto license in Germany, it is necessary to comply with the standards set by the MiCA as well as all requirements defined by BaFin – the Federal Financial Supervisory Authority. The licensing procedure in Germany includes the following key elements:

• Legal entity
  The company must be registered in Germany or in another EU country.
  
• Share capital
  A minimum of EUR 125,000 is required for a custody license (for the storage of crypto assets); for other activities, such as working with crypto securities, the threshold starts at EUR 150,000.
  
• Business plan
  A detailed 3-year business plan must be submitted, describing all crypto-related operations, offered services, and market entry strategy.
  
• Compliance
  Mandatory adherence to AML/CFT (anti-money laundering and counter-terrorism financing) requirements, data protection, and corporate governance rules.
  
• Management
  Company executives must prove their professional qualifications and reliability.
  
• IT infrastructure
  The company must demonstrate secure and reliable technological solutions for the storage, exchange, and trading of virtual assets.
  
• Disclosure of ownership
  All major shareholders must be disclosed, including confirmation of their financial integrity.
  
• Documentation
  All submitted documents must be prepared in German (including audit reports, group structure, etc.).

The process of obtaining a crypto license in Germany requires legal precision, thorough preparation, and a full understanding of regulatory expectations. Prifinance provides professional support at every stage – from company registration and business plan preparation to interaction with BaFin, MiCA compliance checks, and the proper drafting of all documentation in German.

Registration of a crypto company in Germany: Stages and timeframes 

To register as a Crypto-Asset Service Provider (CASP) and obtain a crypto license in Germany under the MiCA, the applicant must go through several key stages:

• Preliminary consultation
  Although a preliminary consultation with BaFin or the Deutsche Bundesbank is not mandatory, it is recommended. This step helps clarify whether the document package meets MiCA requirements and can facilitate the transition to the official submission phase.
• Application submission
  A complete set of documents must be submitted, including:
  
  • a business plan with a detailed description of cryptocurrency operations and market entry strategy,
    
  • proof of the required share capital (which must typically be deposited in a corporate account prior to submission),
    
  • the management structure and a description of the AML/CFT (anti-money laundering and counter-terrorism financing) system.
    The application must be submitted electronically in accordance with Article 62 of the MiCA.
    
• Review process
  Within 25 working days of submitting the full documentation package, BaFin confirms receipt and notifies the applicant of the application’s status. If the submission is deemed complete, the review process begins and takes up to 60 working days. During this time, the regulator may request clarifications or additional documents.
  
• Decision
  If all requirements are met, a license will be issued. The total review period is typically 2 to 3 months (25 + 60 working days), though it may be extended if further clarifications are required. In the case of a rejection, the application can be revised and resubmitted within the specified timeframe.
  
• Fees
  BaFin charges registration and annual supervisory fees. The amount depends on the type of services requested and the complexity of the application. The current fee structure is published on BaFin’s official website and can also be obtained in writing.

Important: The most up-to-date information on the application process and all related requirements must be verified against the provisions of MiCA (Regulation (EU) 2023/1114) and official BaFin guidelines.

Taxation of crypto companies in Germany

Cryptocurrency companies operating in Germany are required to comply with tax legislation and meet a number of established obligations:

• Corporate tax
  The rate is 15.83% for entities registered as companies.
  
• Capital gains tax
  A preferential tax rate of 25% applies to the sale of cryptocurrency held for more than one year.
  
• Value-added tax (VAT)
  BTC and other virtual currencies are exempt from VAT. However, certain types of tokens may be subject to taxation depending on their function and classification.
  
• Reporting
  All cryptocurrency transactions are subject to mandatory reporting, especially when involving offshore or dissolved structures. Additionally, the company must register as a taxpayer within one month after completing commercial registration.

Prifinance provides consultation on the taxation of crypto companies and assists with initial taxpayer registration, coordinating interaction with local specialists and ensuring compliance with German requirements.

Key facts about obtaining a crypto license in Germany (under MiCA)

Trusted experts in crypto law and licensing

The Prifinance team consists of specialists with many years of experience in supporting crypto projects and obtaining licenses in key jurisdictions. We understand the specifics of the cryptocurrency business, the requirements of MiCA and local regulators, and have deep expertise in compliance, KYC/AML, and corporate structuring.

Our practice includes dozens of successfully implemented projects – from the registration of crypto companies and preparation of business documentation to full support throughout all stages of interaction with BaFin and other authorities.

Ready to launch your crypto project in the EU market? Contact the experts at Prifinance – we know how to navigate the licensing process in Germany without unnecessary risks.

FAQ

1. Can non-residents open a cryptocurrency company in Germany?

Yes, provided the applicant has the right to enter the country and meets all legal requirements.

2. What is the minimum share capital?

The minimum capital is EUR 125,000 for a custody license and EUR 150,000 for activities related to cryptocurrency securities (securities registries).

3. How long does it take to obtain a cryptocurrency license in Germany?

The process may take around 6 months, depending on the completeness and accuracy of the submitted application.

4. Is it possible to operate without a cryptocurrency license in Germany?

No. Operating without an authorization is not allowed and may lead to serious penalties, including criminal liability.

5. How does MiCA affect the business?

The MiCA allows companies to operate throughout the EU with a single cryptocurrency license, simplifying cross-border activities.