The Ministry of Financial Services of the Cayman Islands Government announced that it has commenced a legal framework for virtual asset service providers (VASPs).
The Ministry claimed that the new framework had strengthened the government’s ability to attract entities or individuals that deal with virtual assets as a business.
The regulatory framework will commence in two phases. Phase one, which begins 31 October, will enforce anti-money laundering (AML) and countering the financing of terrorism (CFT) rules. Current VASPs in the Caymans, will need to notify and register with the Cayman Islands Monetary Authority (CIMA).
The second phase of the framework, which is expected to come into force in June 2021, will include licensing requirements and prudential supervision for VASPs.
The new virtual assets bill, will introduce provisions to greater facilitate the phased commencement approach, was published on October 29 and will be presented at the next sitting of the Cayman Islands Legislative Assembly.
The Ministry stated, the new rules want to line up the companies in the jurisdiction with the AML/CFT/CPF standards.