11/03/24

From Features

Virtual Assets

In recent years, the global financial landscape has witnessed a paradigm shift with the advent of virtual assets and the emergence of virtual asset service providers (VASPs). These digital currencies and the platforms facilitating their exchange have ushered in a new era of financial innovation and decentralized finance. However, alongside their disruptive potential comes a pressing need for regulatory clarity and oversight. In this feature, we embark on a comprehensive journey across six jurisdictions—Cayman, Hong Kong, Ireland, Jersey, Singapore, BVI and Luxembourg—looking at the regulations governing virtual assets and VASPs. Through a series of insightful articles, we delve into the evolving regulatory frameworks, compliance challenges, and industry developments shaping the future of this burgeoning sector. Each jurisdiction offers a unique perspective on navigating the complexities of virtual asset regulation. With each working to establish themselves as powerhouses in fintech innovation, our exploration promises a diverse array of insights into the regulatory dynamics at play.

Virtual Asset Regulation in Jersey

Jersey

Tshogofatso Dhlamini
Carey Olsen Jersey LLP

Jersey established itself as a crypto-friendly jurisdiction early on, when the island's regulator, the Jersey Financial Services Commission (JFSC), approved the launch of the world's first regulated Bitcoin investment fund, GABI Plc. Whilst the JFSC has a forward-thinking attitude towards the digital assets industry in Jersey, the island is not a ‘crypto free-for-all’ jurisdiction.

Jersey Virtual Assets Market Trends In 2023

Following the FTX crash in November 2022, the digital assets industry started 2023 on shaky ground, coupled with the Securities Exchange Commission filing suits against some of the world's biggest crypto exchanges, i.e. Binance, Coinbase, and Kraken.

Despite the negative trends that affected the digital assets industry on a global scale, Jersey continues to be open to crypto and continues to establish itself as an autonomous and pro-business jurisdiction. In 2023, Jersey has seen an increase in digital asset exchange trade products (ETPs) programmes. In May 2023, Jersey welcomed the ETP programme for digital asset manager Valour, and in July 2023, the JFSC approved the first digital assets investment business licence for digital assets trading firm, Elwood.

Virtual Asset Businesses That Require Regulation In Jersey

Other than introducing the Virtual Asset Service Provider (VASP) regime in Jersey's Anti-money Laundering / Combatting Fina…