On the 28 April 2020 The Cayman Islands published draft legislation with regards to new regulatory framework for companies wishing to utilise virtual asset investments such as Bitcoin. In the Cayman Islands a virtual asset is defined as a digital representation of a value that can be electronically traded and used for investment purposes.
Virtual asset investment is a financial sector that has literally exploded over the past few years. But due to its virtual nature, it is an area whilst providing many attractive traits it also poses problems with regards to regulation and protecting its investors.
The Cayman Islands have initially drafted five proposed legislation, being:-
- Virtual Asset (Service Providers) Bill, 2020
- Monetary Authority (Amendment) (No. 2) Bill, 2020
- Securities Investment Business (Amendment) Bill, 2020
- Mutual Funds (Amendment) (No. 2) Bill, 2020
- Stock Exchange Company (Amendment) Bill, 2020
The Cayman Islands consulted extensively with both local and industry players in its development process in an effort to integrate what is desirable along with what is necessary and as a result of this it is hoped that this legislation allows the necessary flexibility whilst promoting use of the industry in The Cayman Islands whilst also complying with international standards.
It is an advantageous time to introduce such cutting-edge legislation in relation to this automated area as the recent Covid-19 pandemic has highlighted the benefits of being able to operate remotely and electronically.
If you wish to learn more about the attractiveness of The Cayman Islands as an offshore financial centre then please do not hesitate to contact us.