Bermuda is moving forward on cryptocurrency legislation as it seeks to attract fintech entrepreneurs, the country’s Minister of National Security said during an overview of its proposed fintech regulatory framework at the Bermuda Underwater Exploration Institute.
Wayne Caines, the minister, gave the presentation to a standing-room-only audience. The Virtual Currency Business Act is planned to be discussed next month.
According to Kevin Anderson of the Bermuda Monetary Authority, the financial-services regulator, The Virtual Currency Business Act will be a «shining example» for what Bermuda can accomplish. A 150-page paper on the Virtual Currency Business Act was posted on the BMA’s website. Feedback must be submitted by May 2.
The VCBA defines virtual currency business as the provision of the following activities: issuing, selling or redeeming virtual coins, tokens or any other form of virtual currency. This would include an ICO business on behalf of customers. The act would also cover payment service providers, virtual currency exchanges, virtual currency wallets, and virtual currency services vendors.
The legislation will address the intersection of cryptocurrency and fiat, preventing fraud and market manipulation, the integrity of cryptocurrency owners, clear descriptions of the risks for prospective investors and BMA enforcement powers.
Caines said that the government is finding it hard to keep up with the number of people who want to come to Bermuda as it plans to regulate cryptocurrency.
According to Lydia Dickens, manager of government’s business development unit, cryptocurrency entrepreneurs are looking for legal certainty. John Narraway, a tech entrepreneur and member of the Government’s Blockchain Business Development Working Group, agreed, noting that foreigners are more interested in regulatory certainty than tax advantages.
The government will try to establish a Bermuda E-ID scheme this year. This will be a national digital identification program for businesses and residents that will strengthen the country’s fintech credentials. It will include rules for cryptocurrency exchanges. The Caribbean Financial Action Task Force will assess Bermuda’s anti-money laundering and anti-terrorist financing measures.
The national ID scheme will eliminate the need for multiple hard copies of documents and to give individuals control over their data. A single aggregation platform will allow people to comply with KYC/AML rules. This scheme will also speed up customer verification for banks and financial services and enable fast-track immigration.