Setting Up a Licensed Crypto Company in Germany (MiCAR CASP)

Do you even need a BaFin licence? The 8 crypto-asset services

A CASP must be authorised to provide any of the crypto-asset services defined in MiCA (Art. 3 / Annex IV). These are the activities that trigger CASP authorisation:

• Custody and administration of crypto-assets on behalf of clients
• Operation of a trading platform for crypto-assets
• Exchange of crypto-assets for funds
• Exchange of crypto-assets for other crypto-assets
• Execution of orders for crypto-assets on behalf of clients
• Placing of crypto-assets
• Reception and transmission of orders for crypto-assets on behalf of clients
• Advice on crypto-assets
• Portfolio management on crypto-assets

If you provide one or more of these, you need MiCAR CASP authorisation (or an EU passport from another Member State). If your activity is not a crypto-asset service, you may fall outside the CASP regime entirely, in which case classify your activity first before assuming a licence applies. Getting this classification right is the foundation of the whole project.

The three capital classes, €50k / €125k / €150k

Your minimum own-funds requirement depends on which services you provide, under MiCA Art. 67 together with Annex IV. There are three classes, and the more sensitive the activity, the higher the floor. This table is the citable reference for the regime:

The prudential safeguard matters as much as the headline figure. Under Art. 67(1) you must hold the higher of the Annex IV minimum for your class or one quarter of the preceding year's fixed overheads. A larger operation can therefore be required to hold well above the €50k/€125k/€150k floor. The safeguard may be met with own funds (Common Equity Tier 1) or with an eligible insurance policy or comparable guarantee (Art. 67(4)–(5)). All figures are statutory minimums and date/currency-sensitive; verify against the current Annex IV text.

What counts toward own funds

Own funds for MiCA purposes means Common Equity Tier 1 (CET1) or, where permitted, an eligible insurance policy or comparable guarantee (Art. 67(4)–(5)). The critical point, and a common and expensive misunderstanding, is that your company's share capital does not satisfy or offset the MiCA own-funds requirement. The GmbH's €25,000 or the AG's €50,000 share capital and the MiCA own-funds floor are separate pots. You must plan for both.

GmbH or AG? The corporate vehicle

A CASP must be a legal person. The usual vehicle is a GmbH, with a minimum share capital of €25,000 (§5(1) GmbHG), of which €12,500 must be paid in before Handelsregister entry (§7(2) GmbHG). For larger or institutional setups, an AG is common, with a minimum share capital of €50,000 (§7 AktG); the AG route for institutional crypto setups (€50k Grundkapital) is covered separately.

Note again the point from the previous section: company share capital is distinct from the MiCA own-funds requirement, and the two do not offset. Forming the entity is the corporate-law step; meeting the own-funds floor is a separate regulatory condition for authorisation. For the GmbH/AG vehicle behind your CASP, see the formation pillar.

The transition has ended, what changed on 31 December 2025

Before MiCA, crypto-custody was a regulated financial service in Germany under §1(1a) sentence 2 no. 6 KWG, licensed by BaFin. MiCA Art. 143 allowed existing providers to continue under national law until they were granted or refused authorisation, or until a backstop date.

Here is the load-bearing currency fact. The EU-wide backstop is 1 July 2026, but Germany shortened the window: the national transition ended 31 December 2025. Existing KWG institutions could use a simplified, fast-track procedure under the Kryptomarkt-Zulassungsübergangsverordnung (KMZÜV), with application deadlines in 2025 (confirm the exact deadline against bafin.de before relying on it).

As of 2026-06-10, the German transition has expired. A firm operating in Germany without a granted German CASP authorisation must passport in from another Member State or cease the activity. Almost no competitor page reflects that the German window closed earlier than the EU backstop. Do not rely on the 1 July 2026 date for a German operation. For a deeper walk-through, see MiCAR CASP licensing, explained.

AML obligations (GwG + travel rule)

CASPs are obliged entities under §2 GwG. That brings a standing compliance programme, not a one-off filing:

• Know-your-customer and customer due diligence
• Ongoing transaction monitoring
• Recordkeeping
• Suspicious-activity reporting

On top of the GwG, the EU Transfer of Funds Regulation "travel rule" applies: identifying data on the sender and recipient must accompany crypto transfers. Germany replaced its national crypto travel rule with the uniform EU standard at the end of 2024. Budget for an AML function and the staffing it implies; it is a core part of what BaFin assesses.

How long does BaFin take?

Under MiCA Art. 63, the statutory clock has two stages: a 25 working-day completeness check, followed by a 40 working-day substantive assessment once your file is complete. In practice, the end-to-end process commonly runs 6+ months once preparation, queries and remediation are included. Treat the statutory clock as a floor, not a promise, and the 6-month figure as an advisory estimate rather than a guarantee. The single biggest driver of delay is an incomplete or weak initial file.

Can you passport across the EU?

Yes. A single MiCAR CASP authorisation granted in one Member State permits you to provide your services across the EU via passporting. You do not need a separate licence in every country where you serve clients. This is a genuine advantage of the German and EU route over fragmented national regimes: one authorisation, EU-wide reach.

Non-resident founders

Nationality and residence are no bar to forming the German GmbH or AG behind a crypto business. The corporate vehicle is open to foreign founders. The regulated entity, however, additionally needs substance for BaFin authorisation: real governance, a functioning AML function, and fit-and-proper management. In other words, forming the company is not the constraint; demonstrating a genuine, well-run operation to the regulator is. Plan for substance from the start rather than treating it as an afterthought.

How a German crypto company is taxed

A company is not an individual, and conflating the two is a common scope trap. For private individuals, crypto held for more than 12 months is tax-free on disposal under §23 EStG (short-term gains are taxed at the individual rate, with a small annual threshold; see the BMF letter of 06.03.2025).

That rule does not apply to a GmbH or AG CASP. Corporate crypto income is ordinary business income, subject to corporate income tax plus trade tax. There is no 12-month exemption for a company. Plan the company's tax position with a corporate crypto tax adviser, not on the basis of the individual rule.

How we help (advisory)

We provide incorporation, introductions and process support: forming the GmbH or AG, coordinating licensed counsel experienced with BaFin, and helping you assemble and manage the authorisation file. We do not promise or guarantee a licence, and no honest adviser can. BaFin alone grants authorisation. What we offer is an English-speaking German firm that coordinates the right licensed Rechtsanwälte and Steuerberater and runs the process with you. Book a consultation to set up a crypto company in Germany on the correct, MiCA-current footing.