Jason Hayward, Minister of Economy and Labor for Bermuda, believes the island has the potential to become a global center for the cryptocurrency industry. On the other hand, the sector should operate under a comprehensive regulatory framework so that investors can benefit from greater protection during events such as the recent collapse of Luna/UST, the politician added.
Crypto crash not a concern for Bermuda
Bermuda’s Minister of Economy and Labor – Jason Hayward – does not view the recent fall in the cryptocurrency market as an inherently negative event. In his view, it could even contribute to the island’s goal of becoming a hub of digital assets:
“We are aware of the recent devaluation in the price of cryptocurrencies and remain confident that it does not threaten the island’s ability to become a crypto hub. This industry downturn is likely to advance our objective and positively impact our long-term growth and role in this sector.
Hayward recalled that authorities in Bermuda started opening their arms to the cryptocurrency space in 2018. The government championed the asset class even during the bear market of 2018, hinting that this support could hold during the current decline.
Nevertheless, the Minister felt that there was an urgent need for proper regulation due to the collapse of the native Terra Luna token and its algorithmic stablecoin UST. Such supervision could limit the losses of future investors, he added.
According to David Schwartz, President of the Financial & International Business Association, Bermuda is among the world leaders in terms of establishing infrastructure for crypto businesses and imposing appropriate regulations. Local authorities have also tightened anti-money laundering controls, monitoring whether bitcoin or altcoins are involved in illicit transactions.
Legislation approved in 2018 requires all cryptocurrency companies in Bermuda to obtain a license from the Bermuda Monetary Authority (BMA). The island’s main financial watchdog also oversees the national insurance and reinsurance industry.
The BMA has given the green light to 14 crypto firms to operate on local soil, with some of the notable firms being Circle, BlockFi and Bittrex.
Crypto hubs around the world
Speaking of countries with a positive stance on the digital asset industry, Portugal and Gibraltar are worth mentioning. The first treats the asset class as a currency and does not impose VAT or other taxes on local investors. More recently, the country’s authorities tried to introduce such a tax but ultimately rejected the proposal.
Another example is the British Overseas Territory of Gibraltar. It has a regulated cryptocurrency regime designed to protect businesses that deal with the asset class and is among the leaders in terms of blockchain adoption.
Not too long ago, China’s leading crypto exchange – Huobi – revealed plans to move its spot trading operations there.
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Bermuda Could Become A Crypto Hub, Says Economy Minister
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