Are you looking to start a business? Perhaps it’s a Digital Asset Business or a business acting as a Digital Asset Service Provider? Perhaps its neither of those and you need further guidance? Regardless of your need we’re here to help.
Digital Asset Business Act
In the summer of 2018 we rolled out our Digital Asset Business Act (DABA) which set the foundation for our regulatory approach towards the new digital asset industry.
A digital asset business means the business of providing any or all of the following digital asset business activities to the general public
- issuing, selling or redeeming virtual coins, tokens or any other form of digital asset;
- operating as a payment service provider business utilising digital assets
which includes the provision of services for the transfer of funds;
- operating as an electronic exchange;
- operating as an derivatives exchange;
- providing custodial wallet services;
- operating as a digital asset services vendor
We have two different types of licenses
- Class M (Modified) – Our sandbox license
- Class F (Full) – A full digital asset business license
Risk Management Approach
An important distinction regarding our DABA legislation is that our regulator, the Bermuda Monetary Authority (BMA) takes a risk management approach to regulating digital asset businesses.
This means the regulator is flexible to understanding the nature and maturity of your business and focuses on ensuring you manage the risks rather than following the act to the letter. Depending on the size of your business the regulator is flexible about requirements, assuming you have taken steps to clearly define and provide a plan to manage your appropriate business risks, particularly with regards to compliance, custody and cyber.
Our regulator is flexible, responsive and open to discussions so you can be assured you get the guidance and clarity you need to ensure you can fit within our framework. Though, do expect to be held to a very high standard of risk management. As the world’s leading offshore risk capital, we take risk management very seriously.
Our Class M license is designed to be a flexible sandbox license where you can establish your business under the guidance of our regulator, the Bermuda Monetary Authority (BMA).
The regulator works closely with you as you establish your business providing guidance as you strengthen your business model,determine your risks and establish how you manage them.
Our class F license is a full license to operate as a Digital Asset Business in Bermuda and applies when you have met the stipulations put forth by the Digital Asset Business Act and have been approved by our financial regulator, the Bermuda Monetary Authority.
The minimum annual fees for a digital asset business hover between $15,000 and $150,000 Bermuda dollars (1:1 with USD) – depending on the nature and size of the operation.
For example, $150,000 is the approximate annual fee an exchange that has custody of keys while an exchange that does not have custody of keys would be approximately $100,000.
The maximum fees can be upwards of $450,000, which is for companies that attract significant overall volume. The belief is that if they reach such volume, the supervision is going to be expensive and the business profitability capable of supporting said supervision.
Generally speaking, the fee increases by a factor of 0.00075 until it has capped at the maximum when clients receipt exceed $133M for non-custodial exchange and $200M for custodial exchange.
Government's Concierge Service
We want to make sure you have everything you need to get your business up and running quickly. In order to do this, Bermuda offers our unique personalized concierge service to get you the answers you need quickly.
We connect you with everyone you need to meet from regulators, banks, law firms, service providers and government departments.
Our aim is to offer you a personalized experience that caters to your needs. If you need to move quickly, we can arrange everything so that you can fly to the island in the morning, meet everyone you need and be able to fly out that same evening with the answers you need. If you’d like a more relaxed approach that lets you see some of the island we can arrange things at your leisure.
Establish your business
Once you’ve chosen Bermuda as the place to establish your business the Government’s Concierge Service is here to help coordinate to ensure you get setup quickly and painlessly as well as save on costs.
- Provides a single-entry point for all Government of Bermuda enquiries and applications.
- Facilitates meetings with Government Officials to discuss inward investment and related initiatives.
- Works with clients to identify the approvals they may need and helps to facilitate prompt service and attention from Government Agencies (via MOUs for expedited processing for concierge clients).
- Provides practical advice and guidance during the client’s relocation process.
- Provides pre-screening of Concierge client immigration, tax, and social insurance applications to facilitate easier processing by the necessary Government agency.
- Liaises with the Bermuda Monetary Authority, Department of Immigration, Ministry of Finance, FinTech Business Unit and Registrar of Companies as needed on new incorporations and monitor the processing of new applications.
- Facilitates dialogue with the Department of Immigration for senior executives looking to achieve permanent residency status under the Incentives for Job Makers Act 2011.