Building a crypto product for the Americas and considering Costa Rica as your base? This no-fluff guide explains what a “VASP license” means in practice, which business models are in scope, what documents and controls you’ll need, and how to launch without rework. If you want a structured, start-to-finish route, see Costa Rica VASP license for an overview of the process.

Why founders look at Costa Rica

• Nearshore reach: convenient time zones for North and South America, with a strong services ecosystem.
• Talent and stability: a mature tech/services market and predictable day-to-day operations.
• Practical compliance path: clear AML expectations; workable for startups that keep scope tight.
• Remote-friendly: much of the process (KYC, filings, banking prep) can be handled without travel when the file is clean.

What “VASP” covers (simple view)

“Virtual Asset Service Provider” is a broad label for crypto businesses that exchange, transfer, or custody digital assets for customers. Whether you need authorization/registration and a full AML program depends on what you actually do with client funds and wallets. A few quick examples:

• Exchange/brokerage: buying/selling crypto for customers or routing orders—almost always in scope.
• Hosted wallets/custody: you control keys or can move client funds—high scrutiny.
• Transfers/payments: moving crypto between users, cash-in/cash-out, or remittances—expect clear rules.
• On/off-ramp: fiat–crypto conversions settling to user accounts—treated like financial services in many cases.

Non-custodial tools (you never touch keys) may have lighter obligations, but embedded brokerage, order-matching, or settlement can still pull you into scope. Map your real flows before picking a structure.

Core expectations from regulators and banking partners

Successful filings and banking reviews tend to include the same foundations:

• Clean corporate structure: directors/officers/UBOs identified; straightforward control and decision-making.
• Written AML program: KYC/KYB standards, sanctions screening, transaction monitoring, suspicious activity reporting, and recordkeeping.
• Named Compliance Officer: real authority, reporting line to senior management, and training plan.
• Risk assessment: customers, products, delivery channels, geographies; how you mitigate each risk area.
• Security and custody design: wallet architecture, key management (HSM/multisig), hot/cold segregation, withdrawal approvals, incident response.
• Customer disclosures: T&Cs, risk summaries, fee schedule, complaints handling, and fair marketing.
• Financial soundness: runway, budget, and contingency planning that match your scope.

Choosing a business model (and what it changes)

• Non-custodial app (no key control): lowest custody risk; make sure you’re not performing brokerage or running an order book in disguise.
• Custodial wallet: high bar for safeguarding and access-control; withdrawals should require dual approval and screening.
• Retail exchange: trading, matching, or a marketplace experience pulls you into the deepest set of obligations—plan for it.
• Payments/remittance: design for the Travel Rule, sanctions, and source-of-funds evidence on both sides of the transfer.

Where you place each function (product entity, ops entity, vendor) matters. Document who does what, who holds keys, and how data moves. This clarity prevents slowdowns during review.

Documents checklist (what you’ll likely prepare)

• Corporate pack: articles, director/shareholder registers, org chart, shareholder agreements (if any).
• People and ownership: IDs, proof of address, CVs for directors/officers/UBOs; fit-and-proper confirmations where required.
• Business plan: product scope (wallets, exchange, payments), target users, jurisdictions, corridors, pricing, and unit economics.
• Compliance program: AML manual, sanctions policy, KYC standards, Travel Rule method, monitoring procedures, escalation/STR flow, training calendar.
• Tech and security: wallet/key design, segregation policy, vendor list and due diligence, incident playbooks, and pen-test policy.
• Custody & safeguarding: cold/hot thresholds, withdrawal approvals, reconciliation, insurance (if applicable).
• Financials: 12–24-month budget, capital policy, and continuity plan.
• Customer docs: T&Cs, risk disclosures, fee schedule, complaint handling, and marketing standards.

KYC, Travel Rule, and monitoring (how to make it work in production)

• KYC/KYB: verify retail users; collect company docs and UBOs for business accounts; refresh on a risk-based cycle.
• Sanctions screening: on onboarding and continuously; screen counterparties and vendors as well.
• Travel Rule: attach originator/beneficiary data to qualifying transfers; integrate a provider that works across your main corridors.
• Monitoring: rules + machine assistance; address typologies (mixers, darknet, mules); keep a case log and escalation trail.
• Recordkeeping: keep auditable evidence—onboarding files, risk ratings, approvals, transfer logs, and alert outcomes.

Design these controls into your product from day one. Retrofitting is slower and creates “policy vs. product” mismatches that reviewers flag immediately.

Timeline and sequencing that avoids dead-ends

1. Model mapping & gap analysis (1–2 weeks): define scope, custody, corridors, and target users. Decide the minimum viable footprint that still meets your goals.
2. Policy drafting (2–4 weeks): build the AML/Travel Rule/monitoring program that matches the model—no boilerplate contradictions.
3. Pre-filing alignment (1–2 weeks): appoint Compliance Officer, confirm vendors (KYC, Travel Rule, custody tech), and tidy the corporate structure.
4. Submission & clarifications: file a complete pack; answer questions with short, evidenced replies (policy excerpt, screenshot, log output).
5. Go-live readiness (parallel): integrate vendors, test withdrawal approvals, run a tabletop incident drill, and finalise reporting templates.

Keep the first version focused. Each extra feature (margin, staking, order books) increases questions and slows time-to-market.

Banking, EMIs, and PSPs

Every provider will ask two questions: Can you keep illicit funds out? and Can you safeguard client assets? Strengthen your file with:

• Clear segregation between company and client assets; reconciliation routine and access controls.
• Sanctions and Travel Rule coverage for inbound and outbound flows.
• Counterparty policy for exchanges, market makers, and custodians you rely on.
• Evidence of monitoring in action (test cases, thresholds, escalation matrix).

Many teams start with a fintech-friendly EMI/PSP for day-to-day operations and add a traditional bank for redundancy. Choose partners that actually support your corridors and risk profile; switching later is costly.

Cost buckets (the realistic way to budget)

• One-off setup: advisory/policy drafting, application prep, and legal reviews.
• Technology & security: KYC vendor, Travel Rule solution, custody tooling, monitoring stack, and security testing.
• Ongoing compliance: officer time, audits, transaction monitoring, reporting, training, and renewals.

Budget by bucket rather than chasing a single “license fee” number. Under-budgeting leads to shortcuts that later need remediation.

Risk checklist (avoid these five)

• Policy–product mismatch: manuals claim controls you haven’t built yet.
• Unclear customer journey: reviewers can’t trace onboarding → funding → trading → withdrawal.
• Weak Travel Rule plan: “we’ll add it later” is not enough—pick a solution and show it working.
• Vendor due diligence gaps: no assessments for custodians/KYC/monitoring tools you depend on.
• Over-broad scope at v1: trading + custody + leverage on day one multiplies approvals and delays.

FAQ

Do all crypto businesses need the same authorization?
No. Requirements depend on whether you handle client assets and how your service maps to exchange, custody, or payments.

Can a non-custodial app avoid the heavy lift?
Often lighter, yes—but embedded brokerage or order-matching can still trigger rules. Map your features carefully.

How long does the process take?
It varies by completeness and complexity. Clean files that match product reality move faster; plan buffer time for clarifications.

What do banks look for?
Evidence you can keep illicit funds out, safeguard client assets, and operate reliably (policies, logs, segregation, incident playbooks).

Can we scale cross-border later?
Yes—document roles across entities, corridors, and data flows now to make later expansions smoother.

Who can help

LegalBison is an international advisory firm helping crypto and fintech teams obtain the permissions they need, design workable compliance programs, and secure banking. The team blends legal precision with practical build-out so founders can launch safely and scale with confidence. Learn more at legalbison.com.