How Three Small Baltic States Ended Up Running Europe's Crypto Plumbing

When MiCA came into force, the smart money picked its winners early, and the shortlist always read like a roll call of old money, with Frankfurt, Paris, Dublin, Amsterdam, and Luxembourg turning up in every version of it. Those places have incumbent banks, supervisory headcount and lobbying muscle, so the assumption was fair enough.

The transitional window slammed shut, the raw tallies appear to confirm it. Germany sits at the top of the CASP authorisation table, ahead of France and the Netherlands, out of 322 records across the EEA.

Open that German column, though, and hardly any of the names are crypto companies. It is Commerzbank, DZ BANK, DekaBank and a scattering of regional Volksbanks, a lead built almost entirely on incumbent banks that sit well outside what MiCA was written to govern.

Of the 322 authorisations, 206 went to crypto-native businesses and 116 to traditional institutions adding crypto to an existing book. Only 17 firms on the whole register are licensed to run a live trading platform. Germany’s column is the most bank-heavy of all, which is why its headline lead is misleading.

Counting licences tells you where applications got processed. It reveals close to nothing about where Europe's crypto plumbing is being welded together, and on that question I’d point 1,500 kilometres northeast, to three countries whose combined population would fit inside metropolitan Paris.

Regulators that chose subtraction

Estonia carried 1,234 licensed crypto firms at the end of 2019 and, by 2021, an estimated 55% of the world's registered virtual asset service providers (VASPs) — a widely cited figure that is difficult to independently verify. A licence back then cost only €300 and came with light scrutiny. The country’s Financial Intelligence Unit spent three years dismantling that, and by 1 May 2023 exactly 100 authorisations were left standing.

Lithuania ran the same operation on a slower clock. Around 850 crypto companies sat on its register in late 2022; across 2025 the Bank of Lithuania received 102 MiCA applications from just 55 firms, and had granted three CASP licences by early January 2026.

Latvia never had the volume to lose and has authorised ten CASPs since the regulation took effect (a count that shifts as the register updates), a stablecoin payments firm tenth in July. 

Three governments installed a filter, and it did precisely what filters do.

Riga offers consultations — at  €2,500 

Bank of Latvia does something unusual for a financial supervisor, which is to give its own time away. Prospective applicants get unlimited free consultations (roughly 100 a year, conducted in English) before the company in question legally exists.

Application fees run to €2,500, among the lowest in the EU, with ongoing supervision pegged at 0.6% of gross revenue and a €3,000 floor. Latvia can afford to charge that little because the consultations catch hopeless applications early. If the regulator thinks a structure won't pass, it says so in the meeting, and that's usually the end of it.

Compare this with the jurisdictions where dialogue begins only after you have paid a law firm six figures to guess what the regulator wants. Those markets end up selecting for firms skilled at navigating bureaucracy, which is a different competence from building products people can actually use.

Dual licences are the tell

Four of Latvia's ten licensed CASPs have now paired their MiCA authorisation with a payment or e-money licence from the very same regulator, several of them within weeks of each other. 

Stacking MiCA on top of PSD2 is what a company does when its product is a rail. Custody and exchange permissions cover the crypto leg; the payment institution licence covers euros arriving and leaving, along with consumer protections a CASP authorisation by itself does not carry.

Talent compounds where it lands

Vilnius holds the deepest bench in the region. Lithuania's 248 active fintechs employ close to 7,800 people and serve around 40 million customers, and its payment and e-money institutions moved €163 billion last year, up 57% since the end of 2022.

Average team size there climbed from 21 to 31 over five years even as the company count fell from 282 to 248. Fewer firms, bigger firms, more experienced teams.

Tallinn contributes something harder to tabulate, in a country of 1.3 million that has produced ten unicorns and attracted over 130,000 e-residents from 180-odd countries who, between them, registered more than 37,000 Estonian companies. Skype's alumni are still seeding new ventures two decades after the exit.

Riga adds roughly 40,000 ICT specialists, about 4.4% of everyone employed in Latvia, with the country ranking third in Europe for ICT students per million inhabitants. Together, the three produce engineers who can read and handle both regulatory compliance and blockchain infrastructure.

Hiring a compliance officer who has already survived a supervisory review is an ordinary Tuesday in Vilnius. Try that in a city where the crypto industry showed up last year.

The big centres are reading it wrong

Set the compliance bar high enough to screen out the weak and what remains is a smaller, sturdier field. Passporting then carries those survivors across all 27 member states from a single regulator.

With roughly 83% of legacy-registered firms never converting to a full MiCA licence, each early licence looks more valuable by the month. Most of the 322 authorisations Europe is busy counting will never move serious volume, and a Baltic handful will end up moving most of it. Redraw Europe's crypto map around the licences that cover real rails, and its centre of gravity settles a long way north of Frankfurt.

Author: 

Innokenty Isers is the founder and CEO of Paybis, a trusted crypto exchange and wallet. With over 20 years of experience in online business and technology, Innokenty has been at the forefront of driving innovation in the crypto space. Under his leadership, Paybis has grown into a global hub offering secure and compliant solutions for buying, selling, and managing digital assets, serving customers in over 180 countries. His vision is centered on bridging the gap between traditional finance and the rapidly evolving digital economy, empowering individuals and businesses to participate in the decentralized financial ecosystem. 

https://www.linkedin.com/in/innokenty-isers-931724218/