Bermuda bets on cryptocurrency despite bear market

Bermuda is one of the few countries in the world that has a comprehensive framework for cryptocurrency.

Clear regulation of cryptocurrency

Bermudian regulators say their understanding of international trade, which accounts for about 27% of the island’s economy, along with a trained local workforce, is leading to the development of a thriving digital asset industry on the island. This puts Bermuda in competition with other jurisdictions vying for a share of the cryptocurrency industry, such as Malta and Liechtenstein.

In particular, Bermuda’s Minister of Economy and Labor Jason Hayward said in an interview with Wall Street Magazine :

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

It is important to highlight the governments and companies that are talking about the uses of cryptocurrency more than its value at any time. In fact, Fidelity Investments is massively expanding its Web 3.0 business and emphasizing the importance of a long-term vision.

Hayward said the island has been building its fintech and cryptocurrency industries since 2017 and continued through the last downturn in 2018. He said the recent meltdown of Terra and LUNA highlighted the importance of risk monitoring and mitigation, of which Bermuda has its experience as a hub. Insurance and reinsurance.

This very rational approach makes it possible to highlight the shortcomings of the current system governing cryptocurrencies, and the excessive volatility and collapse of the cryptocurrency still poses a danger to other projects that have interest and are trying to develop products to improve the global economy.

The image of the arbitrator in the concept of cryptocurrency law
Image via epicimages on upload images

To this end, Bermuda recently adopted a comprehensive framework to regulate digital assets and strengthened its controls on the laundering of illicit money.

The Financial Action Task Force on Money Laundering (FATF), a Paris-based organization that sets standards in anti-money laundering legislation, said Bermuda has made significant improvements to its anti-money laundering technical compliance system. Several major regulations, according to their 2020 mutual assessment, but the FATF noted difficulties in recovering proceeds from illegal activities. Panama also introduces strict measures on money laundering in its new cryptocurrency regulations.

licensing system

The licensing process in Bermuda can be divided into three phases: ‘The Sandbox’ pilot licensing, similar to that used in the island’s technology insurance licensing system; A modified license and finally a full license, according to Mr. Hayward.

He explained that the trial license usually lasts between three to twelve months, in order to allow the cryptocurrency company to test its activity. But he declined to give the time normally needed to get a full license, saying it depends on the complexity of the crypto product.

We note here a holistic approach to the cryptocurrency sector, it is important to work collaboratively with stakeholders on Web 3.0 in order to create the best regulation and licensing together for the government and businesses.

Bermuda has a particularly open and understanding approach to this new sector. Other countries should take care of this very open model that does not ignore the importance of strict regulation and oversight in order to prevent any abuse.

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Alexis Patten

Passionate about geopolitics, economics, cryptocurrency, Eurasia and travel! (as far east as possible), cryptocurrency trader for 4 years.

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