The Bank of Lithuania has published some documents that update its position on virtual assets and initial coin offerings (ICOs). The initial document was released in October 2017, and this is just its update.
As per the announcement published on Feb. 14, the recent document does not illustrate any changes to its underlying principles. However, it still stressed that financial market participants (FMP) should separate their financial services activities from those associated with virtual currency and should not participate in activities or provide services associated with virtual assets.
FMPs are still prohibited to accept virtual assets with the obligation to repay them with or without interest. The new policy provides the provision to employ third-party services, while payments to FMP accounts can only be made in fiat currencies. The bank stresses that FMP could not issue virtual asset loans or accept virtual assets as collateral unless they are considered to be securities.
In a seminar held in last October, the Lithuanian regulators examined the “threats and potential benefits” of ICOs to the country’s economy. It was then outlined that a high ICO turnover volume of €500 million ($567 million) over the previous eighteen months, necessitated for tougher anti-fraud mechanisms. It was further noted
“according to ICO figures, Lithuania is one of the world leaders and shows the highest, 305 percent, growth from all over the world.”