The Czech Republic continues to emerge as a forward-thinking jurisdiction for cryptocurrency businesses in 2025, offering a balanced blend of regulatory flexibility and compliance with EU standards. While a dedicated crypto-specific legal framework is still evolving, the country operates under comprehensive general financial legislation, enabling innovation while maintaining transparency and investor protection. This guide explores the current regulatory landscape, licensing procedures, tax obligations, and future developments shaping the crypto ecosystem in the Czech Republic.
Current Regulatory Framework for Cryptocurrencies
In the Czech Republic, cryptocurrency activities are not classified as a standalone regulated sector, and digital assets are not recognized as legal tender. Instead, they are treated as commodities under existing financial laws. This classification stems from the fact that blockchain-based digital units do not constitute claims denominated in national currency issued by central banks or financial institutions, according to the Payment Systems Act, Section 4(1).
Despite the absence of a specialized crypto law, all crypto-related economic activities must comply with broader financial market regulations. The Financial Analytical Office (FAU) oversees anti-money laundering (AML) and counter-terrorist financing (CFT) compliance for all financial market participants, working closely with the Czech National Bank (CNB), which supervises the overall financial system. Additional regulatory bodies include the Czech Trade Inspection Authority and the Ministry of Finance.
👉 Discover how to launch your compliant crypto venture in a favorable EU jurisdiction.
AML/CFT Compliance for Crypto Companies
The Czech Republic has implemented key EU directives—4AMLD, 5AMLD, and 6AMLD—into national law, ensuring that crypto exchanges and wallet providers adhere to strict AML/CFT protocols. These measures apply broadly to entities involved in trading, storing, managing, or facilitating virtual currency transactions.
Under Czech law, virtual currency is defined as a digital unit not issued by a central authority but accepted by third parties as payment for goods or services.
Core AML/CFT obligations include:
- Establishing and enforcing internal AML/CFT policies
- Conducting customer due diligence (CDD) and ongoing monitoring
- Performing risk assessments for clients and transactions
- Appointing a qualified AML officer with proper training
- Identifying and verifying ultimate beneficial owners (UBOs)
- Reporting suspicious transactions to the FAU
- Maintaining records and preparing reports upon request
- Facilitating information exchange for cross-border transfers
Relevant legislation includes:
- Act No. 253/2008 on AML – Sets foundational AML/CFT principles
- Decree No. 281/2008 – Details corporate AML/CFT procedures
- Criminal Code (Act No. 40/2009) – Defines financial crimes
- Act No. 69/2006 on International Sanctions – Governs sanction compliance
Non-compliance can lead to severe penalties, including business suspension, asset seizure, fines up to 500,000 CZK (~€20,204), and public disclosure of violations.
Business Structures for Crypto Companies
To operate legally, foreign and domestic entrepreneurs must establish a registered company in the Czech Republic. The most popular structure is the Limited Liability Company (s.r.o.), favored for its low entry barriers and operational flexibility.
Limited Liability Company (s.r.o.)
- Minimum share capital: Just 1 CZK (~€0.04)
- Shareholders: At least one, natural or legal person
- Directors: At least one, no residency requirement
Audit exemption: Applies unless two of the following thresholds are exceeded:
- Net turnover > 80 million CZK (~€3.2M)
- Total assets > 40 million CZK (~€1.6M)
- Average employees > 50
Joint-Stock Company (a.s.)
Suitable for larger ventures seeking public investment:
- Minimum capital: 2 million CZK (~€80,000)
- Governance: Shareholders’ meeting, board, and supervisory board
- Audit requirement: Mandatory if thresholds above are met
👉 Learn how to structure your crypto business for EU market access.
Licensing Requirements for Crypto Activities
While there is no specific "crypto license," companies must obtain a Trade License from the Trade Licensing Register. The application is submitted online via the Central Electronic Registration Room with a secure electronic signature.
Key license types for crypto firms:
- Classic: Exchange between cryptocurrencies for a fee
- Fiat: Exchange between crypto and fiat currencies
- Traditional: Currency exchange intermediary services
- Professional: Specialized crypto services (e.g., wallets, key management)
The process typically takes up to four months, including company formation. Required documents include:
- Articles of Association
- Detailed business plan with financial projections
- ID and criminal record certificates for founders/directors
- Proof of educational qualifications
- Description of technical infrastructure
- Bank confirmation of capital deposit
- Copy of relevant trade license
Remote setup is possible via a power of attorney.
Taxation of Cryptocurrency Businesses
Crypto companies are taxed under general corporate rules unless EU law specifies otherwise. The Czech tax year aligns with the calendar year, though companies may opt for a fiscal year.
Key tax rates:
- Corporate Income Tax (CIT): 21%
- Branch Tax: 19%
- Capital Gains Tax (CGT): 0–19%
- Withholding Tax (WHT): 15%
- VAT: 21% (exempt for crypto-fiat exchanges per ECJ ruling)
- Social Security Insurance (SSI): 24.8%
- Health Insurance (HI): 9%
Resident companies are taxed on global income; non-residents only on Czech-sourced income. Over 80 double taxation treaties help mitigate international tax risks.
Future Regulatory Developments: MiCA and Beyond
As an EU member, the Czech Republic will adopt the Markets in Crypto-Assets (MiCA) regulation by 2025. MiCA will introduce harmonized rules for Crypto Asset Service Providers (CASPs), enhancing legal clarity and market integrity.
Key MiCA impacts:
- Mandatory public registry of CASPs managed by EBA
- Stricter AML/CFT oversight for high-risk jurisdictions
- Requirements for stablecoin issuers to maintain 1:1 reserve ratios
- Energy disclosure rules for proof-of-work assets
- Exclusions for DeFi and NFTs in initial phase
Additionally, the DLT Pilot Regime (PDMIR) allows sandbox-style testing of blockchain-based trading and settlement systems until 2026, supporting innovation under regulatory supervision.
Support Initiatives for Crypto Startups
The Czech government fosters innovation through various programs:
- CzechInvest’s CzechStarter: A 7-month incubator offering funding, workshops, and expert mentoring
- Technology Incubation Program: Up to 850 million CZK (~€35.4M) in funding for 250 startups across key sectors
- CNB FinTech Contact Point: A streamlined channel for regulatory guidance
- Blockchain Alliance CZ: Promotes blockchain adoption and fights fraud
- Crypto Anarchism Institute: Advocates for decentralized economic models
Events like the European Bitcoin Conference and CHES (Cryptographic Hardware and Embedded Systems) in Prague further strengthen the local ecosystem.
Frequently Asked Questions
What is the legal status of cryptocurrencies in the Czech Republic?
Cryptocurrencies are not legal tender but are treated as commodities under current law.
Do I need a license to run a crypto business?
Yes, a trade license is required, categorized based on your business model (e.g., exchange, wallet services).
Is VAT applicable to crypto transactions?
No—exchanges between crypto and fiat are VAT-exempt under EU law.
Can I set up a crypto company remotely?
Yes, through a power of attorney authorizing a local representative.
What are the minimum capital requirements?
Only 1 CZK (~€0.04) for an s.r.o., making it highly accessible.
How does MiCA affect existing crypto firms?
MiCA will require compliance with new transparency, governance, and reserve rules by 2025.
👉 Stay ahead of MiCA compliance with strategic guidance from industry experts.