Lithuania’s regulatory landscape is undergoing a very significant shift, with crypto-asset licensing reforms and stricter fintech governance rules reshaping the market, according to Walless Partner Laurynas Narvydas.
"The crypto regulatory landscape continues to dominate fintech legal work in Lithuania," Narvydas begins. “A significant portion of our current mandates comes from clients seeking to obtain crypto-asset service provider licenses in Lithuania or, alternatively, exploring relocation options,” he explains. “Lithuania once had several hundred registered crypto providers, but only a few dozen of them have applied for a new license under the new MiCA regime. As a result, and due to the fact that the MiCA transitional regime is near its end and is unlikely to be extended, we now have hundreds of companies assessing their strategies, including restructuring, relocation, or winding down.”
Narvydas stresses that the MiCA transitional period, which started at the beginning of 2025, generated substantial advisory work. “Clients want clarity on which jurisdictions remain conducive to their business models, what relocation actually entails in practice, and how to navigate the increasingly complex regulatory expectations across Europe,” he reports. “Ensuring that the chosen jurisdiction offers a sustainable, credible regulatory environment has become a strategic question for many crypto firms.”
Another key development shaping the Lithuanian financial sector is the Central Bank’s newly adopted regulatory framework for fintech companies, particularly electronic money institutions and payment institutions. “The Central Bank introduced new requirements refining and updating rules regarding the management, internal control, and clients’ funds protection,” Narvydas notes. “These will enter into force on January 1, 2026, and the past several months have been heavily focused on helping clients redesign their organizational structures to comply.”
According to him, the reforms are substantial. “The new rules aim at strengthening the supervisory function and require clearly dividing responsibilities of the management and supervisory function in internal documents, creating enhanced organizational structure, internal information systems, internal controls, and risk management functions, and imposing additional requirements on client funds protection procedures,” he explains. One of the most operationally challenging aspects is the shift in safeguarding account requirements. “Today, institutions may safeguard clients’ funds in a single safeguarding account. Under the new regime, two accounts with credit institutions will be required, a yearly assessment of such credit institutions will have to be carried out, and a maximum amount to be safeguarded on each account will have to be determined. This may not be legally complex, but it is technically and operationally demanding for fintech companies, requiring updates to systems, policies, and liquidity management processes.”
Narvydas concludes that these regulatory upgrades reflect broader market expectations. “Lithuania has positioned itself as a leading jurisdiction for fintech and crypto, and with that comes a need for more mature supervision. The new rules raise the bar significantly, but they also offer a long-term opportunity for well-structured, well-governed firms to stand out.”
