Cryptocurrency Investment Fund in Lithuania
An Alternative Investment Fund (AIF) is a legal entity established for the purpose of raising capital from a number of different investors with an aim to invest these funds into unconventional tangible and intangible assets to generate favourable returns. Examples of such assets include cryptocurrency and other hedge funds, real estate funds, wine as well as fine art and antiques. The results of such funds are dependent on the fund manager’s skills, fund strategy, investment assets and market situation. Alternative investment funds are regulated by the Alternative Investment Fund Managers Directive (AIFMD) which is the key piece of legislation defining activities of all EU-based fund managers.
The marketing of assets of an AIF managed by an AIFMD-licensed management company to professional and/or retail investors may be started only after the AIF has obtained an authorisation from the Bank of Lithuania to market assets of the relevant AIF to professional and/or retail investors in Lithuania.
When launching a crypto-asset fund, regulatory compliance, fund structure, jurisdiction and documentation are of paramount importance. Our dedicated and highly experienced team of Company in Lithuania can provide expert guidance in establishing a new cryptocurrency investment fund in Lithuania.
Formation of a Cryptocurrency Investment Fund
Funds investing in crypto-assets are classified as Alternative Investment Funds (AIFs) and they’re managed by Alternative Investment Fund Managers (AIFMs). In fact, such funds can only be established and managed by professional investment fund managers, i.e. a management company whose main activity is the management of investment fund assets and which is licensed by the Bank of Lithuania to engage in such activities.
Before launching a cryptocurrency investment fund, managers should consider a number of stages and factors pertaining to the process. Here’s an outline of the key stages:
- Carefully defining strategy and writing up an offering memorandum.
- Raising the initial capital and premarketing with key investors to determine interest in the fund (premarketing conditions are covered by the Bank of Lithuania).
- Deciding on the most suitable business structure in Lithuania.
- Continuing your marketing activities to attract more investors.
- Laying out a credible investment proposition through the design of a robust infrastructure, compliance and risk management function.
- Applying for authorisations from the Lithuanian regulatory institutions.
- Drafting and negotiating any required legal documentation for the fund.
Company in Lithuania UAB offers legal support in setting up cryptocurrency investment funds so that you start out with confidence and a clear outlook.
An alternative investment company intending to operate under the local law may have the following legal forms: