The Bermuda Monetary Authority (BMA) claims that it is seeking to develop a comprehensive framework that would offer cryptocurrency businesses a safer and more stable environment through new proposed legislation.
The authority claims that by seeking public feedback on proposed anti-money laundering laws designed to regulate domestic cryptocurrency activity, it will better be able to develop this framework and environment.
According to a report by the Royal Gazette on Thursday, Bermuda’s minister of national security Wayne Caines believed the industry needed well-rounded regulation before it could flourish. He maintained that the BMA had 20 companies in London waiting to do business, commenting that “it’s actually phenomenal”.
In a paper released on Thursday, Bermuda’s financial regulator said the proposed legislation – the Virtual Currency Act – would call for cryptocurrency exchanges, wallet services and new coin offerings to collect and keep records of their customers. Regulation of ICO organizers would not be part of the act as the aim is not prohibition, but development, said legislators. ICOs would fall under separate legislation.
The Caribbean and Bitcoin
Caribbean governments and businesses are showing increasing interest in currencies like Bitcoin. In recent years, due to slow growth and high debt rates, major US banks have become more reticent about doing business in the region, frequently withdrawing capital from Caribbean markets. This has created a deficit of banking services inciting local banks to engage in illegal activities such as facilitating money laundering.
The sluggish economy and the tourist industry on which it mostly survives need a boost, and Bitcoin is proposed by some as a way of energizing it. The Caribbean Tourism Organization plans to introduce cryptocurrency payments for tourist services and integrate Caribbean economies in the region through the use of virtual currencies.
“Tourism is the largest single contributor to the Caribbean economy. It is absolutely critical to every single Caribbean nation’s well-being and development. We see this as a very natural and necessary association,” said Rawdon Adams, CEO of blockchain payment startup Bitt.
There is enthusiasm for new technology among several Caribbean economies through the adoption of cryptocurrencies as the Eastern Caribbean bank considers its own currency, the Digital Eastern Caribbean Dollar (DXCD), with eight governments and economies behind the project.
It is unclear if Bermuda would be able to sign up for the region’s digital currency as it is not officially listed as a Caribbean island due to its location in the Sargasso Sea.