Cryptocurrency regulation has remained a nightmare for many nations and organizations operating in and outside the industry. There are still no clear-cut rules on how crypto functions in the majority of parts of the world. While some nations have banned crypto entirely, others are still developing frameworks that are not clear, like the SEC and CFTC in the US.
A nation like Bermuda attracted several crypto organizations due to a framework for digital assets it release in 2018. Today, the country has three licensing classifications – a “T” license for testing firms, an “M” license for organizations that want to expand their operations, and an “F” license for mature companies.
Despite being a welcoming place for crypto, bad actors should be weary of this nation. Speaking at Consensus 2023, David Burt, the Premier of Bermuda, that while Bermuda is a good location to raise capital for crypto-based investments, people who refuse to follow the laws set out will be prosecuted. It is “a terrible place to hide it.”
He went further saying the country’s prisons are ready to absorb defaulters. “Yes, our prison does have an ocean view, but it’s still a prison. I promise that you won’t enjoy your stay.” The Premier added that the rules needed for companies in the digital asset industry to thrive are already in place and are a major reason why several crypto firms want to come to Bermuda.
FTX, Crypto firm, and Bermuda
In 2022, Bermuda would have been affected by the crash of FTX, however, thanks to Bermuda’s regulations, the collapsed exchange moved its headquarters to the Bahamas. David had said that the 2022 crypto crash had little effect on the country’s economy.
Coinbase is one of the largest crypto firms that have been given a license to operate in Bermuda following its discussions in March with foreign institutional clients about expanding its services, and the recent uncertainties about crypto rules in the US.
Coinbase has also hinted that it might move out of the US if the authorities are not ready to institute the right and clear regulations for crypto. Other crypto firms that have gained licenses in Bermuda are Apex Group, Bittrex, BlockFi, Circle, and Jewel.