Thanks to its clear regulatory framework, Bermuda wants to become a recognised place in the crypto ecosystem. The Financial Action Task Force (FATF) has recognized their efforts in the fight against money laundering, although it notes areas for improvement in the monitoring of illicit transactions.
Bermuda welcomes crypto companies
Because of its regulatory framework, Bermuda aims to become a hub in the crypto ecosystem. This is what Jason Hayward, the Minister of Economy and Labour, told the Wall Street Journal:
Bermuda is well positioned to become a leading domicile for digital asset companies as a result of the enactment of the Digital Asset Business Act (DABA).
Appropriate regulation makes Bermuda a more attractive place to do Business. https://t.co/HgMDhw55e2– Jason Hayward (@MPJasonHayward) June 3, 2022
Despite falling prices, Jayson Hayward is confident that the archipelago will have a role to play in the blockchain industry:
“We are aware of the recent devaluation in cryptocurrency prices and remain confident that it does not threaten the island’s ability to become a crypto hub. This downturn […] is likely to advance our goal and positively impact our long-term growth […]. “
Local regulators say their expertise in international trade, which accounts for 27% of the island’s economy, gives them a predisposition to be recognised in our ecosystem.
According to the minister, Bermuda has in fact been developing its crypto skills since 2017 and has persevered through the subsequent fall. The recent events in Terra (LUNA) moreover reinforce Jayson Hayward’s belief in the need for relevant regulation.
Regulation welcomed by FATF
While the archipelago is often associated with a tax haven in the collective mind, its legal clarity rather offers an attractive argument for blockchain companies. The Financial Action Task Force (FATF), which provides the standards that governments can refer to in the fight against money laundering, welcomes their work.
While there is still room for improvement in identifying illicit transactions, the FATF notes that Bermuda has made significant improvements in its regulatory framework.
This framework was put in place in 2018 by the Bermuda Monetary Authority (BMA) and now has 14 registered companies, including four this year. Examples include Circle, which issues the stablecoin USDC and the centralised lending and borrowing platform BlockFi.
The registration process consists of three stages, namely a test licence, a so-called modified licence and a full licence. During this gradual process, the authorities can judge the seriousness of the candidates.
Indeed, if the archipelago wishes to shine in our ecosystem, the BMA does not intend to accept just anyone, it is necessary to comply with its quality requirements. This is why the BMA offers online training for blockchain companies to understand the expectations of the regulation.
Like Dubai and other parts of the world, Bermuda is now publicly asserting its ambitions to become a crypto hub.
