Estonia is a crypto-friendly country. However, there are certain challenges as well. Foreigners linked to Estonia’s e-residency program are being linked to cryptocurrency frauds.
It is worth noting that, the Financial Intelligence Unit of the local police discovered that companies from abroad owned by e-residents of Estonia took part in multiple large-scale exit scams.
Interestingly, regulators also suspect that Estonian firms and e-residents committed other crimes as well. They organized initial coin offering scams based on the information taken from the report prepared by the police.
Estonia and crypto-related crimes
Three months ago, Estonia suffered another reputational damage. The country was in the epicenter of a $220 billion money-laundering scandal. Notably, Estonian regulators immediately revoked the licenses of more than 500 crypto companies as a response to the scam.
At the moment, there are only 353 companies that have a crypto license in the country. The number of licensed companies fell from 1.234 to 353 companies in less than a year. This fact shows that regulators are willing to take measures to deal with crypto-related crimes.
This scandal already caused significant damage to the country’s digitization endeavors. However, the involvement of e-residents in crypto scams has the potential to create another problem.
The government of Estonia launched the e-residency program in 2014. This program offers Estonian citizenship to every person irrespective of where this person lives.
Currently, there are close to 70,000 Estonian e-residents. Hopefully, the e-residency team is working with the police and the Financial Intelligence Unit to investigate the case. Fortunately, the e-residency team is willing to improve the reputation of this program.
There are is no lack of crypto-related crimes. Despite challenges, there is no need to ban cryptocurrencies. Authorities in Estonia and elsewhere should work with companies and individuals to come up with the best solution.