One of Europe\u2019s most digital currency-friendly nations has changed tune, stripping 500 firms of their operating licenses. Estonian authorities turned to the drastic measures as they attempt to clean up their financial services industry following Europe\u2019s largest-ever money laundering scandal. Ever since it emerged that a local branch of Denmark\u2019s Danske Bank was heavily involved in a $226 billion money laundering scandal, Estonian authorities have been clamping down on financial firms. They are now turning their focus from banks to digital currency firms, Bloomberg reports. According to the report, Estonia has stripped 500 digital currency firms of their licenses. This is over a third of all licensed digital currency firms which stand at 1,400. This is the country\u2019s attempt to ensure that criminals don\u2019t turn to the industry for illicit transactions and money laundering. Madis Reimand, the head of Estonia\u2019s Financial Intelligence Unit, believes that the move was necessary. He told Bloomberg, \u201cThis is a first step in tidying up the market, allowing us to take care of the most urgent issues by permitting operations only for companies that can be subjected to Estonian supervision and coercive measures.\u201d The digital currency industry has been the cause of concern for regulators in Estonia, he added. In 2019, the FIU conducted 56 supervisory inspections, with 36 being on digital currency companies. In most of the cases, the regulator was investigating embezzlement claims or allegations of providing financial services abroad without proper authorization. Reimand also revealed that most of the casualties have been companies that failed to start operations within six months of obtaining a permit. Some of the companies have been victims of regulatory changes. The regulator further cautioned that more than half of the remaining 900 licensed firms will most likely lose their permits. This is because most have not set up operations in Estonia and their managers are outside the country. Estonia is one of Europe\u2019s most digital currency-friendly nations. The country was among the first to formulate regulations for the digital currency industry. Its friendly approach has seen many exchanges from across the world set up shop in the country, the latest being India\u2019s BuyUCoin.