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Estonian E-Residency – Do You Need It?

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e-Estonia exhibition

There has recently been a lot of buzz online about the new E-residency program in Estonia, especially among internet entrepreneurs and so-called digital nomads – people who make their money from location-independent online businesses. In this article we will go over what Estonian E-residency actually is, why anyone would want to get it, and who can benefit from it.

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For those not familiar with Estonia, it is a small Baltic state in Northern Europe. Since its independence from the Soviet Union in 1991, Estonia has achieved dramatic results in terms of modernization and digitalization of their country. They were the first country to hold elections over the Internet in 2005, and introduced their ground-breaking E-residency program in 2014.

Estonia today boasts one of the fastest growing economies in the EU, with a highly developed IT sector as one of the main drivers. The country also scores highly in terms economic freedom and freedom of speech, and through this they have created a perfect environment for online entrepreneurs.

What is E-Residency?

Estonian E-Residency card

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You may be wondering what exactly the term E-residency means. First of all, E-residency is not a physical residence permit or a path to EU citizenship for those seeking that. Further, it cannot be used as a travel document for visa-free travel or photo ID.

What you do get, however, is a digital ID card issued by the Government of Estonia. With it, you are authorized to set up a company in Estonia, digitally sign documents, make secure banking transactions, and access government services online.

Today, more than 3,500 companies have been registered by Estonian E-residents, and the number keeps growing. In fact, the Estonian government has stated that they aim to attract more than 10 million E-residents by 2025.

Although Estonian E-residency may seem to offer limited opportunities for some people now, it is worth noting that the ease of use and benefit of the program is expected to increase as the program grows. For example, the E-resident card is said to be recognized as an online ID by all EU countries by 2018.

Why Do I Need It?

So, what’s the benefit of this for me you may be asking.

E-residency is the perfect solution for people who want to conduct business within the EU without actually living there. For instance, as an Estonian E-resident, an American entrepreneur would be able to set up an Estonian company that he runs from anywhere in the world, in order to serve clients that are based in the EU. The entrepreneur would also be able to sign contracts with clients throughout the EU, and easily and cost-effectively receive and transfer money to anyone in the EU. Everything is done online, securely and hassle-free.

It is particularly useful if you want to hold a bank account in Estonia. Unlike lots of other banks around the world, an Estonian e-Residency does not require you to be physically present to sign important documents. Hence, you can conduct all business and banking activities remotely and entirely online.

Because of these features, Estonian E-residency is a great vehicle for digital nomads and international entrepreneurs. Although running a location-independent business still poses some challenges, Estonian E-residency definitely brings you one step closer to having a location-independent company.

Furthermore, you are able to take advantage of other benefits for your company, such as low maintenance costs, a simple tax system with low corporate taxes, an efficient bureaucracy, and international banking.

An added benefit to international entrepreneurs basing their company out of Estonia is the solid image it reflects. Unlike Seychelles or British Virgin Island companies, basing your company in Estonia will not raise any red flags among customers, banks, or tax authorities abroad. It displays credibility and shows that you are paying taxes, even though they will often be substantially lower than what is possible if you base the company out of your home country.

How Do I Apply for Estonian E-Residency?

All you need to do in order to apply for Estonian E-residency is complete an application form online, and anyone in the world is eligible to apply. On the application form, you will be required to upload a photo, state your reason for applying, and pay a 100 Euro fee. Once the application is submitted, you will have to wait about 1 week for the Estonian Police and Border Guard to complete the background check.

If your application is approved, you can choose the pickup location for your ID card; either an Estonian embassy or consulate abroad, or visit a Police and Border Guard station in Estonia. The entire process from start to finish usually take about three to four weeks.

We would love to hear from you in the comments below if this is something you are considering doing or if you have already been through the process. We are also always happy to point you in the right direction if you have any questions about the process.

Featured image from Flickr.

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6 Comments

6 Comments

  1. birmas

    August 16, 2017 at 1:47 pm

    Starting to wonder why I’m signed up to hacked.com when I read articles like this

    • Fredrik Vold

      August 19, 2017 at 9:34 am

      Sorry to hear you didn’t like the article.

  2. zgorizzo

    August 16, 2017 at 2:08 pm

    It might be more interesting to tackle the taxes optimisation oopportunity of that program. Indeed in term of taxes how do we benefit from that eResidency ? I mean if you physically work in a UE country more than 140 working day you have to pay taxes in that country. Is it just something for people you gain benefits from a website ? If you are an IT Freelancer working at your customer office 2 days a week and the other three days remotly how can you benefit from that ?

    • Dag Fredrik Vold

      August 16, 2017 at 3:17 pm

      Hi zgorizzo,

      As I explained in the post, Estonian E-residency will be most useful for people from outside the EU who wishes to do business inside the EU and therefor need a EU-based company. If you are already a tax resident of a EU country, you may or may not save any taxes by getting an e-residency.

  3. porcupine1967

    August 16, 2017 at 2:28 pm

    Useful for our US company needing Eu payments. Chase screw us on charges for Eu payments

    • Dag Fredrik Vold

      August 16, 2017 at 3:19 pm

      Great! Yes, your case sounds like one where the e-residency could be very useful 🙂

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How I Made It: Multimillion Dollar Cash Flow

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Please excuse the image. It’s not a picture of me nor my car. I own a BMW 318 2009 model with a car seat in the back for our seven months old daughter. It’s been some time since I last published a post on Hacked.com. I want to let you know that I’m going to be more active in the coming months. I’ve just had too many things on my plate, from my Digital Trainee job at Wilhelmsen to Hacked.com, CryptoCoinsNews, MoneyMakers, and family. I want to explain how I’ve managed to create a company with a multimillion-dollar cashflow. Remember, I’ve spent more than nine years on reaching my current level. I’ve had multiple failures, I’ve lost hundreds of thousands of dollars, but I’ve also made a lot of money and recognition.

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When I was 16 years old, I started my first company which I registered on my mom. I called it for “Limitless Juggernaut, ” and it was a clothing line that I started to sell in Tønsberg (a small city in Norway). I managed to get my clothes in one shop in Tønsberg, but it did not catch on. I think I sold five to ten pieces and ended up with a loss of $5000. I worked as a phone seller to make the money I spent on my micro startup. In 2008, when I was 18, I started a phone import business where I imported phones from China and sold it on Norway’s “ebay.” I managed to make $3500 in profit each month while attending high school. There was a guy in Oslo, the capital of Norway, that wanted to get into the phone businesses with me. I was young and naive; I put too much trust in a stranger that ended up hustling me. He gained control of my stock, and I transferred some money to him, then I never heard back. I decided to shut the business down.

In 2009 I started studying Entrepreneurship and Business at a college in Oslo. That’s when I founded MyGoodAct which was one of the first crowdfunding platforms for social causes. During four years the platform raised more than 1.5 million USD to different social causes. I managed to sign up the most significant NGOs in Norway, but the main issue was to establish a positive cash flow for the startup. Even though we won awards, was funded by some larger companies and organizations, we never really got the traction we needed. I decided to shut MyGoodAct down in 2015.

In 2013, when I was working part-time for an NGO, I discovered Bitcoin (Cyprus chaos was blowing up the Bitcoin price and made it to the news). I fell in love with the digital currency, mostly due to its deflationary functions. I was sick of the fundamentals of our economy, with fraction banking and the private FED. At that time, there were few news sites for Bitcoin, so I started CryptoCoinsNews. I started writing two to three articles per day, posted stories on bitcointalk.org and Reddit. After a couple of months, the site had 100 to 300 visitors per day, and I managed to secure one advertiser that paid one bitcoin per month for the top banner. After that, I had some funds to pay other writers with, so I started to recruit writers. The site grew, I got more advertisers that paid a fixed fee per banner on a monthly basis. Today, CCN is one of the largest bitcoin news sources in the world. Last month, I bought CCN.COM for 150 000 USD, and we are doing a complete redesign of the site and hiring more full-time writers. I want to make CCN the world leader in cryptocurrency news, just like Marketwatch.com is for stocks.

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I bought Hacked.com in 2014 for $50 000. I saw the domain on Flippa.com, and I had profits from my previous bitcoin investments. I had no plan for the domain; I just thought it was the coolest domain I’ve ever seen available. I was up 24 hours bidding on the frigging domain while watching The 100 on Netflix. The other bidder I was bidding against only increased the price with 50 to 100 USD at the end of each auction period, which made the auction extend with another hour. I became so tired and angry at that tactic, so I contacted the seller and told him that I’d exit the auction if we do not end this soon. I was ready to bump it up with $5 000 or even $10 000 just to be done with it. The seller added a buy now price at $50 000, and I was able to purchase it before the other bidder.

We started Hacked.com as a technology news site, at one point, we had a trending story on Reddit that made it to the front page of Reddit.com. It generated almost a million visitors during one day; our servers could not handle the traffic. However, even with one million visitors, we only made $2000 in ad revenue from Adsense. And, you need to keep pumping out extraordinary articles to keep such a momentum. The prices for such articles could be anywhere from $50 to $500. I did not have the funds to keep funding writers and attract better talent, as the site always operated with a loss. After one year, I decided to put Hacked.com on pause.

In 2015 I started Tailored Message that was a news app for youth in Norway, with gamification and a shop. The idea was to make a clone of “Instagram/Reddit” for news and blogs and let the users earn points based on ads in the app that they could spend on products in our in-app store. We launched the app in April 2016, and we got more than 20 000 downloads, just in Norway, and made it to the top 3 most downloaded apps. I spent almost 100 000 USD on the startup, and in the summer of 2016, we secured 200 000 USD in funding including a marketing deal with one of Norway’s largest media companies worth 300 000 USD. I moved into the media company and hired a salesperson. Unfortunately, the marketing deal that was signed by their director was never followed through. I spent almost six months implement the marketing deal that we already had agreed on. The media company always had excuses for why they could not implement it, and we changed the marketing deal two times without any success. The investors I had became worried, and in the winter of 2016, I decided to shut it down, pay the investors back with what was left, and try to focus on something else. I went to a lawyer in Oslo, and he told me that we could sue the media company for our losses, but that it would cost $30 000 and could take a year or two. I was upset, but I did not want to have a lawsuit to define my next year. I backed out.

What I learned from this experience, which was a very tough period in my life (as I hate to disappoint people that put their trust in me), is that you should never depend on a single deal you make with any company. Especially large companies. In large companies, you have so many different opinions, so many shitheads, so many useless persons that only think about themselves and their KPIs. If you are working with large companies, you need backup solutions. I think the best way to run a startup is to be independent, and just gun for it on your own. Fuck the large companies; they are too slow for a startup.

Well, that’s funny. But I was hired in January 2017 by Wilhelmsen, one of the largest shipping companies in the world, as a Digital Trainee. I had lost most of my cash holdings due to Tailored Message, and I needed something more stable to focus on. My wife was pregnant, and we expected our child in April 2017. I’ve never worked fulltime in a large corporation before, and I thought it would be a great experience to learn how it works. Right now I’m working on a 3D print project where Wilhelmsen wants to 3D print ship parts to the maritime industry, which has been and is an amazing project. I have a leading role there, and I’m learning many new things.

I’m a person that need multiple projects to be satisfied. So after working hours at Wilhelmsen, I pivoted Hacked.com into becoming the service you see today, based on subscriptions. I hired a couple of people, and we started small. After a couple of months, we had a positive cash flow, and I could hire more people to take over some of the time-consuming tasks. And now, Hacked.com is probably the largest paid cryptocurrency community in the world. My initial idea with Hacked.com was to educate people in how they can become more independent of the 9-5 job reality most are living in. This is something that I want to focus more on in the coming years. I also want to host conferences and meetups in 2018. I think we can make something great out of Hacked.com and be supportive of each other.

Right now, both CCN and Hacked.com is generating more money than I would ever dream of. It’s now a multimillion-dollar cash flow business. And I think it’s safe to say that I’ve already reached my long-term goal. Of course, we have large expenses, but the profit is still positive and enables me to invest more in the ventures and improve them.

I’m still working as a Digital Trainee at Wilhelmsen, and please understand that I’ve been working nonstop now for the past two years, I’ve never had one full day off. Sometimes I’ve had to work nights because of DDoS attacks, server problems or similar. I’ve employed more people to take some of the daily tasks I’ve had. I’m also focusing on spending more time with my wife and daughter, as I’ve been absent for an extended period. Money, cash flow, and business is not everything, family, friends, and experiences are what you will remember when you are 80 years old. Remember to enjoy your life.

However, I’m still not satisfied. That’s the way I am as a person. Damaged. Entrepreneurial. I continuously want to improve, want to launch better services, give more people the services that they appreciate. Help people reach their full potential. I think there are some good opportunities in the shipping industry, and I may be able to do something fascinating with Wilhelmsen in the coming years.

Focus on what you love to do, and never look back. Don’t let a shitty job bring you down.

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Buying and Storing Physical Gold in Hong Kong

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Hong Kong gold

If you are one of the many people who feel uncertain about the direction of the global economy and stock market, you should be looking for other options to preserve and grow your wealth. Cryptocurrency is obviously one option, but with the high volatility that comes with it, some people may prefer more traditional stores of value. In this article, we will guide you through exactly how you can buy and store physical gold in Hong Kong, widely regarded as one of the best places in the world to buy gold.

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Bars, coins, or jewelry?

If you are buying gold as a pure investment, it is always a good idea to buy your gold as close to the gold spot price as you can get. For gold jewelry, there is always a big premium added on top of the gold spot rate to pay for the design, brand, marketing, etc. Traditional gold coins also carry a premium for their fancy design of up to 7% over the spot market value of the gold.

The best way to buy gold for investment purposes is gold bars, big or small, depending on your budget. Generally, the larger gold bar you buy, the lower the premium over the spot price will be.

Where can I buy gold bars in Hong Kong?

I personally consider Hong Kong to be the best location for buying physical gold. It is first of all a nice city to visit if you haven’t been there, prices are low, and the staff you deal with generally speak English.

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As you walk down the streets in Hong Kong, you will see gold and jewelry shops on almost every corner. Competition is fierce, and the buy/sell spread on the physical metal is therefore among the smallest you can find anywhere in the world.

In addition to very tight spreads, Hong Kong has no sales tax on gold (or anything else for that matter), keeping the prices you pay as close to the read market rate as possible. And let’s not forget that it is also an excellent place to store your gold once you have purchased it.

While gold smiths and jewelry shops in Hong Kong generally offer much better spreads than in other countries, it is still important that you make sure you don’t pay more than you need to. It is generally recommended to stick to the well-known and reputable shops. Some of the more reputable jewelry shops in Hong Kong are:

While these jewelry shops are the easiest and best known places to buy gold in Hong Kong, the most cost effective way is actually to go straight to the bank. In Hong Kong, several banks actually let you buy gold bars and coins directly over the counter, at least at their main branch in the city. The ones that are most often recommended are:

For a full list of the banks that offer this services, as well as their prices, take a look here.

How should I store my gold?

When it comes to gold storage, there are again many options available. For smaller quantities, you may choose to store your gold in your home. If you happen to have a high quality safe, it may even be totally fine to store larger quantities of gold in your home.

For most of us, however, it is preferred to store gold and other precious metals in a safe location other than your house or apartment. You could choose to bring it back to your home country to keep in in a safety deposit box in your bank, but keep in mind that you may be liable to pay import duties on gold purchased overseas when you bring it across international borders. Each country has different rules pertaining to gold specifically, so make sure to check this first if you want to bring it home with you.

My preferred option however, is to store the gold safely offshore at designated gold storage facilities. Note that this should in most cases not be the same place as you bought the gold, due to risks of default, segregation of your gold from the shop’s own gold, etc. An exception to this would obviously be if you buy your gold in a bank and store it in a safety deposit box in the same bank. In that case you know that your gold is safe and kept separate from other people or the bank’s own gold.

Designated gold storage facilities in Hong Kong will usually charge you about US$75 per year to rent a safety deposit box. Another common way to price it is as a share of your asset value, for example 0.72% of asset value per year.

Final thoughts

There is no doubt that Hong Kong, perhaps together with Singapore and Dubai, is one of the best places in the world both to buy and store gold. If this is something you have been thinking about, I recommend taking a trip to check it out for yourself. After all, Hong Kong is a great city that is worth a trip regardless of whether you choose to buy gold there or not. And as we’ve written about previously, why not open a company and bank account while you are there?

Featured image from Valcambi.com

 

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Total Mindfuck or Nirvana: Our Imaginary Phenomenon

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I love to read good books that can increase my level of understanding. I’m now reading Sapiens by Yuval Noah Harari. A truly mind-altering book that confirms many of my own beliefs (unfortunately?) and that just gave me more respect for Steve Job (see video below)

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Steve Jobs and Yuval Noah Harari are my “gods”. Everything that you see around yourself is made by man. It’s either political systems, values, human rights, the monetary system, religion or even news. As Harari explains, humans can only work in a group that is no larger than 150 people. We do not have the capacity to live in a larger group before things start to unravel. That’s why we all lived in small groups for the most of our history. Homo Sapiens evolved from other ape-like species 150 000 years ago. For 70 000 years ago we entered into a cognitive revolution that made us able to communicate and be creative, to create tools that helped us conquer the world (and kill off the Neanderthals). It’s only 12 000 years ago since we moved from foreaging to farming, where we gradually gathered together in larger groups and started to create imaginary systems to control the population. Our predecessors also had imaginary beliefs, like religion, but not the extensive systems we now see today. Religion was one of the core systems that made us able to find a common goal and live together in larger groups.

The code of Hammurabi is one of the oldest “code of conduct” that is known, dating back to 1754 years BC:

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It is one of the oldest deciphered writings of significant length in the world. The sixth Babylonian king, Hammurabi, enacted the code, and partial copies exist on a seven and a half foot stone stele and consists of 282 laws, with scaled punishments, adjusting “an eye for an eye, a tooth for a tooth” (lex talionis)[1] as graded depending on social status, of slave versus free man or woman.[2]

The code of Hammurabi was created to establish a prosperous community, Mesopotamia. Just like the founding fathers of the USA created Decleration of Independence stating:

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

All laws, all religions, all politics have been created to manipulate and control our inherent DNA. We would not be able to “thrive” the way we do now in larger groups without it. One could argue that we were happier before we started to gather in larger groups (cities). But mankind would not have evolved without it.

We are all tied up to what Harari explains as “Prison Walls”. The objective phenomenon exists independent of human’s consciousness and beliefs. Radioactivity is harmful for people. That’s a fact. A subjective phenomenon is something that exists depending of a single mind’s belief and consciousness. It can disappear or change over time. E.g. I believe that a pink elephant will come and save us all within ten years. This might change if I start to believe in something else or die. The intersubjective phenomenon is something that exists in our network of communication which connects individual subjective consciousness. If one individual die, the intersubjective phenomenon (Christianity or Islam) will not disappear. However, if everyone within the network changed their mind or died, the intersubjective phenomenon would change or disappear.

Why am I writing this post? I think it’s important that you know that everything we do is created by people, for people (or the elite). The monetary system is no different. It was created to control the economic growth and position of a few people, companies or nations. Everything can be changed if enough people start to believe in something else. Cryptocurrencies could be such a shift that might change our monetary system.

Remember, you are free. Do whatever you want, don’t be restrained to people that lived on this planet for hundreds or thousands of years ago. They didn’t know what you do now.

Maybe our true goal as human kind is to reach singularity and relieve ourselves from human restraints.

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