National Security Minister Wayne Caines tabled the Companies and Limited Liability Company (Initial Coin Offering) Act, ushering in a new era in business.
The Bill proposes to treat an initial coin offering as a restricted business activity that requires consent from the Minister of Finance.
The legislation positions Bermuda as “one of the few countries in the world to specifically regulate ICOs”, Mr Caines said.
“It is generally accepted that ICOs are, in most cases, a method of crowdfunding projects or services. However, ICOs may also be used to convey some interest in or right to access or use a physical asset.
“Embracing this new world with responsible regulation could lead to the attraction of new companies and capital investment to Bermuda; additional government revenues; new career, employment and training opportunities for Bermudians, and the laying of a foundation for a prosperous future for our next generation of Bermudians,” he added.
In a statement issued after the brief parliamentary session on Friday, Minister Caines said: “We are enhancing our global reputation and introducing viable ways to strengthen and diversify our economy.”
The new legislation was tabled after a presentation on Thursday, with members of the Blockchain Taskforce, in more than 150 stakeholders heard of Bermuda’s fintech strategy.
“We are proving that we can be a leader in this space, and I wish to thank the members of Blockchain Task Force which included a Business Development Working Group and a Legal and Regulatory Working Group for working with the Government to bring forth this groundbreaking legislation,” said Mr Caines.
Under the Act, an application for consent would be required to include specific details regarding:
• The company conducting the ICO and the underlying digital asset offered for sale;
• The development and implementation of any product, service or other project related to the ICO, including timelines for completion;
• The target amount to be raised through the ICO;
• Rights, features, functionality and intended transferability of the digital asset offered for sale;
• The technology to be used and confirmation of the ability of the technical platform to enable the collection, confirmation and storage of purchaser identity information;
• Compliance and auditing of ICO transactions.
Sean Moran, Head of Business Development for the Bermuda Business Development Agency, said the same qualities that made the island a respected jurisdiction in international business was “now being extended to technologists and innovators”.
“This promises to be an exciting evolution for Bermuda, and we’re pleased it’s being carried forward with careful legislation, contemporary regulatory oversight, and most of all, the type of collaboration our market is renowned for. Our message is that Bermuda is a sensible platform from which these emerging technology companies can do their global business.”