Bermuda Monetary Authority (BMA), the regulator of financial services in Bermuda, is asking for comments on the released draft of Code of Practice for Digital Asset Custody.
The code of practice serves a purpose, and that is to provide the public with protection and at the same time, making clear the expectations which the authority has for digital assets custody. As BMA stated, a feedback deadline has been fixed for January 18, 2019.
According to Moad Fahmi, a Bermuda Monetary Authority Senior adviser, the financial system of the country will benefit from the Code of Practice for Digital Asset Custody:
“We remind stakeholders that the [regulatory] framework was built with the aim of making sure that the core objectives of financial regulation are respected, that is: protecting consumers, ensuring [the] stability of our institutions and maintaining integrity and confidence in financial markets – with a focus on maintaining the highest standards of AML/ATF [Anti-Money Laundering/Anti-Terrorism Financing].”
Aspirations for Global Regulatory Leadership
The Released Bermuda Code of Practice for Digital Asset Custody is among the island’s strategies to becoming leaders in the regulation of digital assets, as Craig Swan, the BMA supervisory managing director, disclosed.
Bermuda has other efforts employed towards becoming a crypto regulatory leader such as improving the banking act so that blockchain startups can be attracted to the island.
The banking act amendment became necessary after it was found out that blockchain firms were not receiving adequate banking services from conventional financial institutions due to the presence of strict regulations.
According to a report issued at the time, David Burt, Bermuda’s premier, stated that there will be no distraction for his government from banks still reluctant to work with blockchain firms in order to keep on track the plan to grow the island through supporting new industries like the distributed ledger technology.
The Regulation of ICO
At the benefits of the year, the British island territory described a plan to provide an ICO regulatory framework and to go down in history as one of the first countries to achieve such a feat. This was made known by Burt during a parliamentary address in March:
“Bermuda has an opportunity to become a global leader in the Fintech space by being one of the first countries in the world to specifically regulate ICOs. The proposed regulatory framework will provide legal certainty to companies looking to conduct ICOs in Bermuda.”
Bermuda has started to enjoy some investments coming into the island from blockchain startups as a reward for the conducive environment the country has provided for both blockchain startups and cryptocurrency. For example, Binance signed a Memorandum of Understanding in April with Bermuda, promising a $5 million investment in the country in the form of blockchain startups.