The northeastern European country of Lithuania is experiencing a boom in cryptocurrency market with a lot of liberal approach towards the regulations. Cryptocurrencies are becoming one of the most prominent investments and payment methods of the country. This boom in cryptocurrency is, however, raising a serious concern of money laundering from the Russian criminal background.
The country has adopted an open arms regulatory stance on digital currencies and blockchain technology. According to a report, the cryptocurrency market at the beginning of January was over $830 billion and at the time of issue, its value was more than $258 billion.
As a result of open arms approach the industry will be supporting the country’s economy. Due to the influx of real cash for digital units, the country hopes to see better growth in the economy. A report by Express suggested the country’s economy can grow by 3.1 percent this year as compared to 2.3 percent average for the rest of the European countries.
However, European central bankers and regulators have been concerned that cryptocurrencies can be a tool for criminals. Bankers are also suggesting that the crypto industry will help in money laundering by giving a medium to convert illegal money into assets. The expansion in Lithuania’s cryptocurrency market can make way to illegal money coming from Russian criminal underworld.
Lithuania has also been actively upgrading its internet network to support heavy data operations. The country’s Finance Ministry has issued guidelines on Initial Coin Offering or ICOs in shaping regulations for cryptocurrency in the country. Without rules, the entrepreneurs raising money will have far less accountability to their investors than in traditional dealings.
Despite all fears startups incubators are seen to throng in large numbers in Vilnius, which particularly happens to be the capital city of Lithuania. The startups come supported by venture capitalists and banks.