OBA Warns of Platinum Period of Cryptocurrency by Michael Dunkley

A succession of MOUs with cryptocurrency firms is starting to sound like the promises made by the PLP during the failed ‘platinum period’ when plans for new hotels failed to materialize, the One Bermuda Alliance.

 

Government has signed a raft of MOUs – memorandums of understanding which are non-binding – with companies amid promises of investment in jobs and training.

 

However, Shadow National Security Minister the Hon. Michael H. Dunkley JP, MP. said the terms of each MOU were non-specific, non-binding and never stated what a minimum requirement was. He also said there appeared to be discrepancies between public announcements and the terms of some of the MOUs. In addition one MOU almost mirrors an MOU recently announced in another jurisdiction!

 

He added: “The OBA is a party of empowerment and diversity, so we would naturally welcome any initiative that creates new opportunities for our fellow Bermudians, however more detail on these MOU’s needs to be provided and more assurances that this industry is here to stay before we can give it our full backing.” 

“At the moment it resembles the previous platinum period when the PLP Government granted special development orders left right and centre and promised new hotels only for nothing to materialize. Cryptocurrency has created a buzz in some areas but we should not forget that over 80 percent of initial coin offerings (ICO) are scams and that 92% fail to reach the trading stage. This does not say that there isn’t potential business for Bermuda; but the hype has outpaced substantive sober discussion.” 

Mr Dunkley said the Premier tweeted about Arbitrade after a presentation in May, ‘the team demonstrated their cryptocurrency platform and explained plans to create more job opportunities in Bermuda for Bermudians’.

 

“But in a lengthy statement, Arbitrade, when it announced it would domicile in Bermuda, made no mention of any jobs being created. We hope that was an oversight and it would be helpful if that can be clarified,” said the former Premier.

 

He also pointed to the details of an MOU with Binance which states that it will “create at least forty (40) jobs in Bermuda”. “When this was originally announced by the Premier he said in a statement that Binance would ‘develop its global compliance base in Bermuda, creating at least forty [40] jobs in Bermuda, with at least 30 jobs for Bermudians’. 

“We hope that the omission in the MOU about the jobs for Bermudians is another oversight and can also be clarified,” said Mr. Dunkley. “If there are no jobs for Bermudians, we would have to question the PLP stated position of putting Bermudians first.”

 

He added that the MOU with Medici Ventures promised the creation of 30 jobs over three years, but failed to say who these jobs were for, or at what level. The announcement of an MOU involving B-Seed Partners, FinHigh Capital and B.F.S. Holdings as partners in a new Bermuda venture, Bermuda FinTech Accelerator spoke only vaguely about the creation of jobs.

 

Mr. Dunkley said shortly after announcing the MOU with Medici the Premier also announced an agreement with Bitt.com and Gabriel Abed for free consultancy but never mentioned that Medici has invested $7 million dollars in Bitt.

 

“No agreement has been tabled with Bitt.com. In life nothing is free and one must ponder if the relationship between Medici and Bitt.com allows them to agree to a “no cost” consultancy or is Bermuda really “another world”?” 

“The MOU with Omega One states that the firm will ‘provide favourable consideration of Bermuda residents and Bermuda-based businesses as part of internal employment and onboarding policies and procedures, with the expectation of adding 20 local jobs in Bermuda over three years’. That is hardly a resounding commitment to employing Bermudians.”

 

Mr. Dunkley added: “What all the MOUs have in common are vague references to something – up to $10m in training, or a ‘potential investment’ of up to $10m. What they also have in common is no apparent minimum requirement, whether in terms of investment or jobs.

 

“There are many questions that need to be answered: When can the people of Bermuda expect to see signed contracts? When can the people of Bermuda expect the new jobs promised? What immigration fast tracking has been agreed to, what number of permits are permitted and can Government assure the people of Bermuda that this new industry is sustainable?”

 

“Many people will remember the DotCom crash when so many companies went bust. Can we be sure that this is not going to happen in the field of cryptocurrency?”

 

“As I stated, the OBA is a party of hope and opportunity and we will support initiatives that are designed to do that, but we need more details other than the vague promises made in a series of MOU’s.”