In a press conference on April 27, Bermuda’s Premier and Minister of Finance David Burt announced a memorandum of understanding and partnership with the Binance Group. Burt described Binance as the “world’s largest cryptocurrency exchange and an international leader in digital exchange development and fintech with a market capitalization of $1.3 billion.”
Bermuda, an island in the North Atlantic Ocean and a British Overseas Territory, wants to establish itself as a blockchain hub and to attract Distributed Ledger Technology (DLT) companies to its jurisdiction. Following recent examples in other jurisdictions like Switzerland’s “Crypto Valley,” Malta and San Marino, the island is trying to attract DLT-related capital and talent.
A press release issued by Bermuda’s Business Development Agency (BDA) noted that Burt, “accompanied by National Security Minister Wayne Caines, led a 20-strong delegation from Bermuda to Consensus 2018,” a three-day blockchain conference in New York City, where Bermuda’s pioneering work to regulate the global blockchain industry was praised by the conference participants.
Burt highlighted Bermuda’s quick progress in becoming “a global hub for fintech enterprises and innovation” through a recent, groundbreaking legislation to govern the regulation of digital assets, and he announced a new $10 million partnership with blockchain network Shyft.
“The government of Bermuda — all the way up to the [premier] himself — is showing remarkable leadership in the blockchain space,” said Don Tapscott, author and executive director of the Blockchain Research Institute, per the Consensus press release. “Bermuda is attempting to figure out an environment that enables both an innovation economy and entrepreneurship, on the one hand, and protecting the interests of consumers and investors on the other. Our institute intends to collaborate much more closely with Bermuda in the future.”
The BDA official website states that Bermuda is “setting the standard for fintech business,” “embracing the blockchain revolution, and creating a robust and fit-for-purpose legal and regulatory framework” governing initial coin offerings (ICOs) and cryptocurrency businesses.
“The BDA can be your first stop to unlocking the potential of using Bermuda for your ICO or fintech business launch,” reads the open invitation to fintech entrepreneurs.
“I’ve talked to dozens of groups that want to launch their ICOs out of Bermuda, they want to establish service provider companies in Bermuda that would help support the growth of our digital asset industry,” said Sean Moran, BDA’s head of business development. “Everyone is excited by what they view to be a jurisdiction that would offer a positive and welcoming environment for new businesses in the blockchain space.”
Bloomberg noted that Bermuda is preparing a new law, the “Digital Asset Business Act,” to encourage and regulate investment in blockchain and cryptocurrency businesses. The Digital Asset Business Act is the second in the series of legislative initiatives designed to facilitate the growth of fintech businesses in Bermuda. The first, to regulate ICOs, passed the Senate earlier in May.
Overstock CEO Patrick Byrne also signed an agreement with the government of Bermuda to set up a blockchain laboratory there, Bloomberg reported. “Omega One, an agency brokerage for cryptocurrencies, will open an office in Bermuda to take advantage of the island’s regulations, and [will] work with insurers and the government to help set up a business to securely hold and insure digital currencies on behalf of investors.”
“All assets will be digital assets in a few years and we need an on-ramp where the current legal form of the assets can reside,” said Omega One CEO Alex Gordon-Brander, as reported subsequently by Bloomberg. “Bermuda has an incredibly strong legal, technical, reputational jurisdiction for financial services in general, but particularly for custody of assets and reinsurance.”
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