As the digital assets industry continues to rapidly mature, offshore jurisdictions like Bermuda, BVI and the Cayman Islands, continue to adapt their regulatory landscapes to meet the evolving market advancements.
Bermuda has established itself as a pro-active and collaborative jurisdiction for digital assets, with the Bermuda Monetary Authority (BMA) licensing some of the world's largest cryptocurrency exchanges.
The BVI remains a popular choice for token issuers and is seeing increased interest from Decentralized finance (DeFi) businesses due to its flexible structures and market familiarity.
The Cayman Islands as a leading offshore financial centre continues to be a top jurisdiction for cryptocurrency projects alongside that of the United States, largely due to its stable and established legislation governing fintech and digital assets.
The regulation of DeFi continues to take form
DeFi continues to raise important questions around governance, control and regulatory oversight. As projects become more complex, understanding when and how DeFi initiatives falls within regulatory scope is critical. Legal structure, operational design, and token utility all play a role in determining a business' compliance responsibilities.
Providing clients with innovative and compliant solutions
With clients requiring more transparency around regulations and compliance, offshore jurisdictions are expected to refine their offerings. Regulatory bodies such as the BMA, the BVI Financial Services Commission and the Cayman Islands Monetary Authority are actively reviewing and enhancing their frameworks to ensure they can accommodate innovation while protecting integrity for each market.
As legal advisors, it is important for us to provide our clients with the right guidance tailored to their business models. Each jurisdiction offers distinct regulatory approaches and understanding those differences is key to aligning with our clients' operational and compliance goals.
If you have any questions on navigating offshore jurisdictions, please reach out to our team of experts.
