Digital asset regulation and tokenization in Latvia

A firm planning crypto-asset business from Latvia must establish whether it will issue the asset, hold it in custody or provide other services to holders. Latvijas Banka centralises MiCA supervision, but each function retains its own conditions: service authorisation does not settle the issuance of a tokenized financial instrument.

Preparation also has a clear timing constraint: the former transition has ended. The project needs current entitlement and an organisation capable of maintaining governance, controls and records after authorisation.

How the project fits Latvian law and MiCA

The Law on Crypto-asset Services, effective from 30 June 2024, supplements MiCA and designates the domestic authority. It covers issuance, public offers, admission to trading and services within the Regulation's perimeter. A common statute for these activities does not turn CASP authorisation into universal permission for digital products.

Transition allowed certain tax-authority-supervised operators to continue until 30 June 2025 and, if they applied in time, until a decision. That continuity remained subject to MiCA Article 143's maximum limit of 1 July 2026. A pending application should not now be presented as indefinite transitional entitlement.

What Latvijas Banka supervises after authorisation

Latvijas Banka centralises domestic MiCA supervision. Its supervisory process description provides for off-site analysis, inspections and measures addressing operational or compliance deficiencies. Assessment continues after licensing: financial, organisational and risk changes may require further supervisory action and remediation by the provider.

Asset-referenced token, ART, and e-money token, EMT, issuance retains its own MiCA requirements. Other crypto-asset offers and disclosure documents also carry obligations. Firms must identify each issuer, offeror, custodian or platform role; publishing a white paper does not by itself constitute supervisory authorisation.

Preparing an application and cross-border access

The CASP procedure, updated on 1 October 2026, includes consultation, business model documentation and assessment of shareholders, management and controls. It separates a 25-working-day completeness check from 40 days of substantive assessment after completion, with possible information requests. These stages do not establish a guaranteed overall launch timetable.

MiCA allows certain financial entities to use Article 60 for equivalent services limited by their status. Other applicants follow ordinary authorisation. Prudential safeguards must reflect Article 67 and the services provided; a class minimum is not the complete budget. Services in other Member States also require the applicable cross-border notification.

When tokenization requires DLT infrastructure

Latvijas Banka's DLT pilot explanation distinguishes crypto-assets that qualify as financial instruments from MiCA services. The pilot concerns trading and settlement infrastructures for eligible instruments. It can cover both instruments initially issued using DLT and traditional securities converted into DLT representations, subject to prescribed conditions and limits.

Regulation 2022/858 requires specific permissions and justification for requested exemptions. A new operator may apply for underlying and pilot permissions together where appropriate, without exemption from all financial rules. Each issuance needs documented enforceable rights, holder entitlement, records and consequences of transfer or loss of access.

Controls that must remain effective during operations

DORA requires ICT risk management, incident handling and external technology service oversight within its scope. Platform and custody assessment should cover access controls, recovery and continuity of critical functions. Infrastructure outsourcing does not replace the management and oversight capabilities required of the authorised entity.

The Transfer of Funds Regulation adds originator and beneficiary information requirements. These must be coordinated with anti-money laundering, sanctions and missing-data procedures. Contracts should identify the responsible entity, authorised services, charges and complaints arrangements, without presenting supervision as a guarantee of asset value.

What to resolve before submitting a project in Latvia

Before filing with Latvijas Banka, map each requested service to its responsible staff, resources and external suppliers. The schedule should allow for completing documentation and answering requests as well as the prescribed assessment periods.

For securities represented using DLT, separately establish valid issuance and registration of the right, and check whether the chosen infrastructure needs pilot permission. The central bank’s general explanation of this route does not establish that a particular operator is authorised.

To understand how this framework applies to your project, discuss your case with our team.