(LowTax) -- Bermuda's Premier, David Burt, has announced his Government's intention to make the island a destination for cryptocurrency activities, including initial coin offerings.
To realize this aspiration, a new blockchain regulatory framework will be created in Bermuda, he said. The framework will regulate the activities of firms operating in or from Bermuda that use blockchain technology to store or transmit value belonging to others, such as virtual currency exchanges, coins, and securitized tokens.
A task force has been set up to design and implement the new regulatory framework, with a focus on ensuring cryptocurrencies and related tokens are well-regulated, and that a safe environment is created to allow cryptocurrency firms to grow, while also protecting consumers and the reputation of the jurisdiction.
The task force is currently establishing a cryptocurrency association, which will be self governing and have its own code of conduct and rules of operation.
It will also ensure that under domestic law, utility tokens will not be treated as a security, as long as there is no promise of future value. According to the Government, this will allow companies from all over the world to set up in Bermuda and use crowdfunding as a way of obtaining financing.
Burt said his Government is separately considering a complementary regulatory framework covering the promotion and sale of utility tokens, aligned with its new blockchain regulatory framework.
Bermuda hopes to have the new framework in place by early 2018.