Few days ago, Wayne Caines, the Minister of National Security, presented an information session for the business community on blockchain technology and cryptocurrencies at the Bermuda Underwater Exploration Institute, according to the Royal Gazette.
The key message launched during the information session concerned the will of Bermuda to become a relevant financial technology centre by creating a world-leading regulatory and legal framework. The Minister Wayne Caines stated that the Government’s plans to regulate virtual currency-based business was very attractive. Next month, the Virtual Currency Business Act (VCBA) is on the agenda and ready for a final discussion.
The consultation paper for the Regulation of Virtual Currency Business was uploaded on the Bermuda Monetary Authority’s website. Comments and suggestions must be submitted by May, 2, 2018.
Between the various objectives, the VCBA stated that: “Leaders in the emerging virtual currency industry are claiming that the rapid growth of virtual currencies represent new opportunities for the use of the virtual currencies and the enabling technology behind them. According to information on CoinMarketCap’s website, the market cap for virtual currencies peaked in December 2017 at $653 billion. That market cap has since fallen significantly. However, enthusiasts have also stated their belief that the industry will grow to one trillion dollars by the end of 2018 and that virtual currencies represent opportunities to improve on, and develop, new payment systems. Whilst Bermuda is keen to embrace the potential offered by the virtual economy, it is recognised that the sector presents tremendous risk that requires robust prudential and Anti-Money Laundering/AntiTerrorism Financing (AML/ATF) regulation.”
This Act will take actions for the following activities: selling, issuing, or redeeming virtual coins, tokens or any other form of digital coins. This would include an ICO business from customers. It would also cover digital currency exchanges, digital currency wallets, and digital currency services vendors.
“Although there are not yet any internationally defined standards relating to the regulation of VCBs, it has been suggested that certain areas of the evolving virtual currency industry should be the focus of regulatory efforts, including the need for effective: regulatory supervision over public disclosure requirements, AML/ATF, fraud prevention, valuation (or price) manipulation,integrity of owners.”
“We can’t keep up with the amount of people who want to come to Bermuda,we’re going to London at the weekend and we have 20 companies lined up to meet us. It’s actually phenomenal.” said Mr Caines at the information session.
In order to explain this phenomenon, Lydia Dickens-manager of Government’s business development unit- stated that “People are looking for legal certainty.They just want to be sure they can conduct this activity and not go to jail.” .
So, as is obvious, crypto entrepreneurs want to see specific and valid rules in what is a mostly unregulated area of the global finance sector.