Bermuda Hopes to Become a Crypto Hub via Solid Regulation

According to an article in the Wall Street Journal, the authorities of Bermuda are confident that their transparency around digital-asset regulation will attract more cryptocurrency projects regardless of the market condition.

In the report published on June 3, 2022, Jason Hayward, Bermuda’s minister of economy and labor, said:

We are aware of the recent devaluation in the price of cryptocurrencies and remain confident that it does not threaten the island’s ability to become a crypto hub. This industry downturn is likely to advance our goal and positively impact our long-term growth and role in this sector.

According to Hayward, Bermuda’s licensing process can be broken down into three stages: a “sandbox” test license, similar to the one used in the island’s insurance-technology licensing regime; a modified license; and finally a full license.

Bermuda currently leads the way in establishing the infrastructure for the crypto industry, according to David Schwartz, president of the Financial & International Business Association. It has a comprehensive framework for regulating digital assets and has equally tightened up its anti-money-laundering controls. The Financial Action Task Force, a Paris-based organization that sets anti-money-laundering law standards, applauded Bermuda in this regard.

Since 2018, Bermuda enforced a regulatory regime governing initial coin offerings and digital business assets. This required crypto businesses to seek approval to operate from the Bermuda Monetary Authority (BMA).

According to Craig Swan, the chief executive of BMA, the country has licensed 14 digital-asset companies, including four crypto companies in 2022. Among the licensed companies are Circle Internet Financial Ltd., the issuer of the stablecoin, USD Coin (USDC); BlockFi, a crypto-lending startup; and Bittrex Inc, a crypto exchange.