Question Best jurisdiction for crypto trading bot? Company formation help?

[milkyway]

Hi All ,
I'm so glad I've discovered this forum.
This is my first post; with this post, I wish to introduce what I am doing and ask for some advice.

My team and I have spent the last year creating a very efficient and low-priced cryptocurrency trading bot platform; users can connect their cryptocurrency exchange (i.e., Binance), create their automation strategy, and then deploy it on our cloud. Users can pay for the fees using crypto, we've been testing it for the last couple of months with friends and family, and it's been performing very well.

We're looking for a jurisdiction to register the aforementioned software company. We originally spoke with consultants in a European country, but from what we gathered, the taxes are high, and the regulation is also. We're looking to set up in a low-regulation and low-tax jurisdiction that will allow us to grow the company.

From what I've gathered, there are far better locations to set up, BVI, and the Cayman Islands, for instance, because they have virtually no taxes, and the regulatory environment seems far less strict than in the EU.
I was initially going to go with a company formation service, but thanks to the members on this forum, they pointed out that they are scammers.

I was wondering what do you think? Where would you set up a business like this? Why? What company formation services would you recommend that can assist us in forming a company there?
Thank you so much in advance,

 

[menzu]

It merely depends on the payment method you want to accept for your users to use the platform.

If for example want to accept Paypal, Stripe, SEPA and ApplePay as payment methods, Andorra could be a good fit.
But if you want to go crypto only, you have unlimited options.

 

[boomy]

Take a look at where other crypto trading platforms are incorporated before you make any choice of jurisdiction. It is critical to do proper research. For banking some of them use Fidor Bank, it requires high volume.

 

[menzu]

Take a look at where other crypto trading platforms are incorporated before you make any choice of jurisdiction. It is critical to do proper research. For banking some of them use Fidor Bank, it requires high volume.

His platform isn’t a crypto exchange and doesn’t accept deposits from users — they just connect to other exchanges via API.

So he doesn’t need a special bank account or anything, he just want to optimize his tax obligations.

 

[Meta]

So basically you have a company that performs some crypto-related services and never touches fiat if I understand you correctly. It generates some profit in BTC and then you use Bitstamp/Coinbase/whatever to cash out your profits to the company's bank accounts. So you can choose some low-regulation country like Cayman Islands, just as you said, as long as there are banks which are fine with this model.
Cannot advise right now, but should not be difficult as long as you are crypto-only, I believe. Also interested, subscribing to the topic. Cheers.

 

[lostguy]

His platform isn’t a crypto exchange and doesn’t accept deposits from users — they just connect to other exchanges via API.

how do you think a bank will look at it when it comes to regular banks

Tax optimizing is cool, but you gonna do it right!

 

[khinkali]

It generates some profit in BTC and then you use Bitstamp/Coinbase/whatever to cash out your profits to the company's bank accounts.

What if the investors pay in crypto and get paid out in crypto?

If the investors want to cash out their crypto gains to fiat, they do so as natural persons which (in many jurisdictions) is easy.

What if the company's investors pay in crypto and take dividends in crypto? Again the owners can cash out as natural persons which (in many jurisdictions) is easy.

The company only needs fiat banking for paying lawyers, hosting, staff. Maybe some of that can by in crypto too.

 

[JimBeam]

Forget the company, how profitable are your bots

 

[cliffordat]

I'd be interested in knowing where you settle on this as I'm in a similar position. I've been advised Cayman / BVI but I understand that all incorporations there are reported to the UK where I am tax resident and may trigger an investigation by HMRC. Nothing to hide but could do without that.