In the EU, rules and requirements for virtual service providers are being actively standardized. However, direct market participants still find it difficult to achieve the level of compliance that allows them to operate seamlessly on regional and international platforms. It is precisely in such situations that the support of the Lawrange team becomes not just appropriate, but strategically important.

 

As legal experts, we monitor even the smallest legislative changes in most popular jurisdictions. Therefore, even before the client contacts us and describes the problem, we often already have a ready-made solution or at least a clear algorithm of actions. It is not surprising that one of our recent projects on the legitimization of a virtual service was implemented without any complications for the client.

 

Would you like more details? Discover them in the following parts of the case!

 

Asset Tokenization in the EU

Like most companies seeking to enter the virtual asset market in the EU, our client faced a number of problems, mainly of a legal nature. Conventionally, we divided them into four groups:

  1. Regulatory challenges:
    • Legal uncertainty: tokens often do not fit into traditional categories (securities, derivatives, electronic money).
    • Fragmentation of rules: different EU countries apply their own interpretations, which complicates cross-border operations.
    • Dual regulation: MiCA covers only part of the tokens, while “security tokens” fall under MiFID II.
  2. Technological challenges:
    • Integration with traditional systems: DLT is difficult to combine with existing exchanges, clearing systems, and custodial services.
    • Lack of standards: a single technical language for tokens has not yet been formed, which complicates their interoperability.
    • Infrastructure reliability: issues of scalability, cybersecurity, and long-term support remain critical.
  3. Economic challenges:
    • Liquidity: even tokenized assets may be effectively “frozen” in the absence of an active secondary market.
    • Valuation: determining the market price becomes more complicated due to the lack of transparent pricing mechanisms.
    • Investor trust: institutional players remain cautious due to the risks of legal and technological instability.
  4. Ambiguities:
    • Ownership status: it must be understood whether a token is a full-fledged object of ownership rights or merely a digital record in a register.
    • Cross-jurisdictionality: a token may be created in France but used in Germany – conflicts of laws arise.
    • Role of central banks: the ECB has not yet defined the final model of interaction between tokenization and the concept of the digital euro.

 

It was precisely these challenges that we needed to neutralize during the implementation of the project. Fortunately, similar tasks had already occurred in our practice. Therefore, we approached the work systematically and with consideration of all risks.

 

Preparation of the Brand’s Legal Framework and Client Support

At Lawrange, we consistently approach the support of obtaining authorizations for virtual service providers in the EU. This task is always multidimensional — it combines legal expertise, communication with regulators, and practical adaptation of clients’ business models. In general, the process looked as follows:

  • We determined whether the client’s activities fell under MiCA, AMLD5, or national laws on virtual asset service providers.
  • We compared the requirements of different EU countries (for example, Lithuania, Estonia, France) to find the optimal balance between speed, cost, and reputational reliability.
  • We developed AML/KYC policies, internal compliance procedures, business plans, and descriptions of technological processes.
  • We conducted dialogue with financial supervisory authorities, explaining the specifics of the client’s services and agreeing on reporting formats.
  • We coordinated the submission process, promptly responded to the regulator’s requests, and helped eliminate identified gaps.
  • We provided the client with instructions on regular reporting, policy updates, and monitoring of legislative changes.

 

Thus, we moved from the foundation of the client’s business model to its legitimization within the legal framework of the European Union. Spoiler — the result met expectations.

 

Result: Brand Entry into the EU Market and Legalization of Activities

Summarizing the results of the cooperation, we can highlight the following achievements:

  • The client obtained the status of a virtual service provider in the selected EU jurisdiction, which allowed them to operate legally in the European market.
  • Thanks to the authorization, the company was able to offer its services to institutional and corporate clients who had previously required confirmation of regulatory compliance.
  • The presence of a license strengthened the brand’s reputation and opened access to partnerships with banks and payment providers.
  • We helped the client implement AML/KYC procedures that not only met regulatory requirements but also became a competitive advantage.
  • Thanks to our support, the client avoided typical mistakes in documentation and communication with regulators, which reduced the risk of refusal or delay.
  • The client received clear instructions on regular reporting and monitoring legislative changes, which ensured operational stability.

 

The main task was completed, the project was successfully implemented and closed. The virtual asset provider gained the opportunity to operate freely in the EU market and, if necessary, scale to other platforms and jurisdictions.

 

Would you like to achieve a similar result? Then do not hesitate. Contact the Lawrange team for a consultation and the launch of your own project!