Operating a digital-asset business without proper payment infrastructure is a slow emergency. A crypto exchange or token issuer that cannot convert fiat, receive merchant settlements or hold client funds in a regulated account is exposed at every commercial layer – from onboarding users to paying staff. In the Czech Republic, the intersection of PSP agreements (contracts with payment service providers) and acquiring agreements (contracts enabling a merchant to accept card and bank-transfer payments) sits inside a regulatory regime that has grown sharper since the European Union's broader payments directives took effect. The regime applies to the business's legal structure, its licence status and the nationality of its users, not just to where the contract is signed.
For any digital-asset business seeking PSP and acquiring agreement coverage in the Czech Republic, the governing framework is the Czech transposition of the EU's Payment Services Directive – administered by the Czech National Bank (CNB) – alongside applicable anti-money-laundering obligations and, increasingly, the cross-sectoral expectations of MiCA (the EU's Markets in Crypto-Assets Regulation) as it reshapes what a licensed CASP (crypto-asset service provider) must demonstrate to a payment counterparty. This page maps the legal ground, the contracting process, the cross-border complications and the decision points a crypto-business operator or general counsel needs to understand before executing an agreement.
Why does the Czech Republic matter for crypto payment rails?
The Czech Republic sits inside the EU single market, meaning a PSP licensed by the CNB under the applicable payments regime can passport its services across the European Economic Area. That passporting value flows both ways: an inbound digital-asset business can contract with a Czech-licensed PSP and reach EU users through a single agreement, while a Czech-domiciled business can use that PSP relationship as its primary fiat-settlement rail across the bloc. In our practice, we regularly advise clients who chose a Czech contracting entity precisely to access that EU-wide reach without replicating separate payment agreements in every member state.
The CNB has historically taken a measured approach to digital-asset businesses seeking payment-service relationships. It neither prohibits banks or payment institutions from serving CASPs nor mandates that they do. The practical result is a risk-appetite negotiation: whether a given PSP or acquirer will onboard a crypto counterparty, and on what terms, depends on the legal package the applicant presents. That package is the core of what we structure before any commercial approach begins.
MiCA authorisation changes the calculus. As the regulation's CASP authorisation requirements become operative for exchanges and other virtual-asset service providers across the EU, a CASP licence issued in any member state – including the Czech Republic – carries passporting rights. PSPs and acquirers in the region are already updating their due-diligence questionnaires to reflect CASP status. A business that presents a valid CASP authorisation (or a credible roadmap to it) faces a materially different risk conversation with a payment counterparty than one that presents an offshore registration alone.
What is a PSP agreement in the crypto context?
A PSP agreement is a contract between a business and a licensed payment service provider that governs how the business sends and receives funds in fiat currency – covering account maintenance, payment processing, currency conversion, settlement timelines and liability allocation. In the crypto context, the agreement typically also addresses permissible transaction types (fiat-to-crypto, crypto-to-fiat conversions at the fiat-settlement layer), enhanced monitoring obligations and the PSP's rights to suspend or terminate on regulatory-change grounds.
The distinction between a PSP agreement and an acquiring agreement matters commercially. An acquiring agreement specifically governs the acceptance of card payments (Visa, Mastercard and similar schemes) and bank-transfer-based payments from end customers. It brings scheme rules into the contractual stack alongside CNB regulatory requirements. Crypto exchanges that accept customer deposits by card need both types of agreement. Each carries its own due-diligence process, and an acquirer's underwriting team will apply its own risk model on top of whatever the PSP has already assessed.
A common structural mistake we see is treating the PSP relationship as subordinate to the licence question – resolving the licence first and assuming the PSP agreement will follow. In practice, many payment partners run their own due-diligence cycle in parallel and impose contractual conditions – reserve requirements, transaction monitoring reporting, periodic legal-opinion updates – that feed back into the business's compliance architecture. Starting both workstreams together, not sequentially, is consistently the faster path.
Who must hold a licence to operate payment services in the Czech Republic?
Any entity providing payment services in the Czech Republic on a commercial basis must either hold a CNB authorisation – as a payment institution, electronic money institution (EMI), or bank – or rely on an exemption (notably the limited-network exemption or the commercial-agent exemption, each tightly defined). A digital-asset business that operates an in-house fiat-collection or fiat-disbursement function is, in many cases, providing payment services and must either licence itself or contract those services to a licensed third party.
The more common model for crypto businesses entering the Czech market is the third-party contracting route: the business itself is a CASP applicant or authorised entity under the applicable virtual-asset regime, while fiat-payment functions are delegated to a CNB-licensed PSP or EMI under a commercial agreement. That delegation is not a compliance bypass. The CNB and the Financial Analytical Unit (FAÚ – the Czech AML authority) expect the business to conduct due diligence on its payment partner, maintain records of the relationship, and ensure that the PSP's Travel Rule (the obligation to pass originator and beneficiary data with a transfer) posture is compatible with the business's own obligations.
For EU-headquartered operators, the MiCA passporting framework increasingly defines who is a regulated CASP and therefore which businesses are acceptable counterparties in the eyes of Czech payment institutions. Operators with no EU footprint – relying on a single offshore registration – are facing sharper scrutiny from CNB-supervised PSPs, whose own compliance teams must justify onboarding unregulated counterparties to their supervisors. This is the structural argument against the offshore-only model.
For a scoped assessment of your licence and contracting position, contact OBOLUS at info@oboluslaw.com. The process above describes the standard path. Your facts – the entity structure, the user base, the intended payment flows – change the analysis materially. Map your options.
How does the PSP onboarding process work for a crypto business?
Onboarding with a PSP or acquirer in the Czech Republic follows a structured due-diligence sequence that a prepared applicant can move through efficiently. In our experience advising clients through this process, the difference between a smooth engagement and a months-long stall almost always comes down to the completeness and coherence of the legal package presented at the outset.
The first stage is the regulatory disclosure package. The PSP's compliance team will assess the business's licence status (CASP authorisation, VASP registration or offshore equivalent), its AML/KYC framework documentation, its ultimate beneficial ownership structure and – critically – its transaction-monitoring capability. A business that can present a MiCA-compliant or MiCA-roadmap compliance programme, supported by a third-party audit or an independent legal opinion, materially reduces the PSP's perceived onboarding risk.
The second stage is commercial term negotiation. PSPs typically propose reserve arrangements (where a portion of settlement is held back against chargeback or regulatory risk), enhanced reporting obligations, and termination rights tied to regulatory-status changes. Negotiating these terms – particularly the reserve quantum, the trigger events for suspension and the notice periods – requires understanding both the payment contract's commercial logic and the downstream effect on the business's liquidity and compliance posture.
The third stage is ongoing compliance maintenance. Czech PSPs operating under CNB supervision are required to file periodic reports on their high-risk counterparties. A crypto business that fails to provide timely AML-update documentation, legal-status certificates or transaction-monitoring reports will trigger a re-underwriting review that can result in account restriction or termination. Operators we advise build a structured compliance-calendar for each payment relationship from day one.
What cross-border complications affect the agreement?
The cross-border dimension of a PSP or acquiring agreement in the Czech Republic is rarely simple. Even where the contract is governed by Czech law, the business's users may be in multiple EU jurisdictions, its token treasury may be custodied in a third country, and its banking may run through an EMI incorporated elsewhere in the EEA. Each of those layers introduces a separate legal obligation that must be consistent with, and disclosed in, the payment agreement.
Under the Travel Rule (the FATF Recommendation 15-derived obligation, transposed across EU member states), virtual-asset transfers above the applicable threshold must carry originator and beneficiary data. A Czech PSP handling fiat settlements for a CASP must be satisfied that the CASP's Travel Rule compliance covers the same user population as the fiat-payment service. Where the CASP serves users in jurisdictions with different Travel Rule thresholds or different technical-standard requirements, the PSP agreement must address how data flows are handled at the edges of that population.
Tax treatment adds another layer. The Czech tax authority (Finanční správa) distinguishes between the tax treatment of the business's own trading activity, its fee income and its clients' crypto-to-fiat conversions at the settlement layer. A PSP agreement that triggers characterisation of conversion income as Czech-source income may create tax exposure for a business that considered itself tax-resident elsewhere. We regularly advise on structuring the payment-flow architecture to ensure that the contracting entity, the settlement-account holder and the tax-residence assertions are consistent. Where there is a mismatch, we engage allied counsel in the relevant jurisdiction to resolve the cross-border position before the agreement is executed.
A matter from our cross-border practice
In a recent matter, a crypto exchange incorporated in an EEA jurisdiction outside the Czech Republic sought a CNB-supervised PSP relationship to reach Central European users. The business had a VASP registration in its home jurisdiction but no MiCA authorisation in progress. The prospective PSP raised AML-questionnaire concerns about the business's user-verification standards and the absence of a Travel Rule technical solution. We restructured the legal disclosure package, engaged allied counsel in the home jurisdiction to produce a legal-opinion letter on VASP-registration scope, and introduced a Travel Rule vendor engagement alongside the PSP process. The PSP's compliance committee approved the onboarding within a business-quarter of restarting the process. Reserve terms were negotiated down from the PSP's standard high-risk template to a lower band, reflecting the strengthened compliance documentation.
What should a crypto business assess before signing a PSP or acquiring agreement?
A PSP or acquiring agreement is not a commodity product – the decision to sign a particular agreement with a particular counterparty should follow a structured self-assessment. The following decision points are the ones we work through with clients before any agreement is executed.
Licence alignment. Does the business's current licence or registration status match the representations required by the agreement? A PSP contract that requires the business to maintain a specific regulatory status creates a termination trigger if that status changes. Operators planning a jurisdiction move or a MiCA application during the term of the agreement need explicit notice provisions and cure-period protections.
Counterparty risk. The PSP or acquirer is itself a regulated entity. Its own regulatory posture – whether it is under CNB supervisory scrutiny, has received warnings or has pending ownership changes – affects the stability of the relationship. In our practice, we conduct a counterparty-review step before recommending execution.
Reserve and liquidity architecture. Settlement reserves held by a PSP are not always immediately accessible. In a fast-moving market, a business whose reserves are frozen pending a re-underwriting review can face a liquidity event. The agreement should specify reserve quantum, release triggers and the process for dispute resolution over held funds.
Termination and wind-down provisions. Many PSP agreements allow termination on short notice without cause. That is commercially acceptable in some contexts but operationally dangerous for a crypto business with no alternate fiat rail. The solution is either negotiating a longer notice period, securing a secondary PSP relationship before reliance on the primary begins, or both.
If a prior PSP relationship has stalled or been terminated, a structural review can identify the cause and the route back. Write to OBOLUS at info@oboluslaw.com or message us via t.me/oboluslaw. A second read of the original due-diligence package often surfaces the precise point of failure and the corrective step. Map your options.
How does EMI onboarding compare with a direct bank account for crypto businesses?
Most digital-asset businesses in Europe today hold their primary fiat relationship with an EMI (electronic money institution) rather than a bank, and the Czech Republic is no exception. Understanding the practical and legal differences between EMI onboarding and bank-account opening matters for the overall payment architecture.
An EMI is authorised to issue electronic money and to provide payment services, but it does not take deposits in the banking-law sense and is not subject to the same capital and liquidity requirements as a bank. For the crypto business, this means two things. First, EMI onboarding is generally faster and risk-appetite is typically wider than at a correspondent-banking institution. Second, the client-money safeguarding regime that applies to EMIs – which requires the EMI to hold customer funds in a segregated account at a credit institution, or to insure them – means that the EMI's own banking relationship is a dependency in the structure. If the EMI's bank relationship fails, the EMI's clients bear the consequences.
We see operators routinely underestimate this dependency. A crypto business onboarded with an EMI that itself relies on a single correspondent bank is carrying a concentration risk it has not priced. The structural answer is to maintain diversified fiat rails – ideally a CNB-supervised EMI relationship in the Czech Republic alongside a separate EMI relationship in another EEA jurisdiction – so that no single bank-relationship failure disrupts the entire payment architecture. This diversified-rail approach is one of the first structural recommendations we make to new clients building their European fiat infrastructure.
A common assumption about offshore licensing
A common assumption among founders is that a single offshore licence – registered in a permissive jurisdiction with low compliance overhead – is sufficient to support a PSP or acquiring relationship with a Czech or broader EU payment counterparty. This assumption is becoming increasingly costly to hold.
CNB-supervised PSPs have tightened their onboarding criteria in line with the European Banking Authority's guidelines on money-laundering risk. An applicant presenting only an offshore VASP registration without a demonstrable EU-regulatory roadmap faces a materially longer onboarding process, more restrictive reserve terms and a higher probability of rejection. The offshore-alone structure also creates cross-border inconsistency: the business may represent to users that it is regulated, while the PSP's compliance team categorises it as unregulated for AML purposes – a mismatch that can produce regulatory questions from both sides simultaneously.
The transition to MiCA is resolving this question structurally. As CASP authorisation becomes the EU-wide standard for crypto-asset service providers, the legal question for any digital-asset business operating in the Czech Republic or seeking Czech payment relationships is not whether to engage with the MiCA regime, but when and through which member state. We map that decision against the business's existing corporate structure, its user-base distribution and its banking relationships before recommending a jurisdiction for CASP authorisation.
Related at OBOLUS
- Banking, Payments and EMI Onboarding – full practice overview for digital-asset fiat-rail structuring
- Fiat On/Off-Ramp Banking: Where the Legal Lines Are Drawn – analysis of the regulatory limits on fiat-rail access for crypto businesses
- Token Sale Agreement Drafting: The Structuring Angle – tax and structuring considerations for token-issuance agreements
FAQ
Why do banks close crypto company accounts?
Banks close crypto company accounts primarily because of AML and reputational-risk concerns. A crypto business that cannot demonstrate a documented KYC programme, a Travel Rule technical solution, transaction-monitoring capability and clear beneficial-ownership disclosure presents an elevated risk profile under the bank's own regulatory obligations. Banks subject to CNB supervision face scrutiny from their own examiners over high-risk-client portfolios. A crypto business that positions itself as a regulated and compliant CASP – with supporting documentation – is categorically easier to defend to an examiner than one presenting only an offshore registration. The practical answer to account closure is a stronger legal package, not a different bank.
How can a VASP onboard with an EMI?
A VASP seeking EMI onboarding should prepare a structured due-diligence package covering: its licence or registration status (ideally MiCA authorisation or a credible MiCA roadmap); its AML/KYC policy documentation; its Travel Rule technical solution and the vendor supporting it; its ultimate beneficial ownership structure with supporting certificates; and its transaction-monitoring reporting capacity. The EMI's compliance team will review this material against its own risk-appetite framework. Timelines vary by EMI and by the completeness of the package – but a well-prepared applicant typically moves through the process materially faster than one that responds to information requests reactively. Allied-counsel support in the EMI's jurisdiction is advisable where the EMI is not Czech-domiciled.
What does client-money safeguarding require?
Client-money safeguarding under the applicable EU payments regime requires an EMI to hold client funds – funds received in exchange for electronic money – either in a segregated account at a credit institution, in safe assets, or under an insurance policy or guarantee covering at least the equivalent amount. The safeguarding obligation exists to protect customers if the EMI becomes insolvent. For a crypto business relying on an EMI for fiat settlement, this means the EMI's choice of safeguarding method – and its banking counterparty – is a material due-diligence question. A business that does not assess its EMI's safeguarding architecture is carrying a risk it has not evaluated.
OBOLUS is an independent digital-asset law boutique acting only for businesses. We advise exchanges, custodians, token issuers and funds on licensing across more than 70 jurisdictions, on disputes and on-chain asset recovery across more than 25 forums, and on the tax, banking and compliance that sit around them. We map the licence stack across operating, custody and payment layers before you commit – so the structure is sound from the outset. Digital assets are the whole of our practice. To discuss your situation, contact info@oboluslaw.com.
By Victor Olsen, Regulatory and Compliance Analyst – specialising in cross-border regulatory frameworks for digital-asset businesses, including CASP authorisation, PSP contracting and AML compliance architecture across EU jurisdictions.
This publication is general information about the law and does not constitute legal advice. It is not a substitute for advice tailored to your circumstances. OBOLUS accepts no liability for action taken or not taken on the basis of this material. For advice on your situation, contact info@oboluslaw.com.