The British Virgin Islands have a long-standing reputation for being a great jurisdiction for international business and financial services. It’s only natural that the Caribbean archipelago developed its own framework of crypto regulation.
This 2024 guide to the crypto license in the British Virgin Islands includes everything you need about one of the most prestigious VASP frameworks in the world: how to start a licensed crypto company in the BVI, what is the process and the requirements, what is the price, and more.
Crypto License in the British Virgin Islands - General Information
What you need to know in 2024 about the crypto license in the British Virgin Islands (BVI)
The crypto license in the British Virgin Islands is called the “Virtual Assets Service Providers license”. It was launched in 2023 by the Financial Services Commission (FSC) of the BVI, through a law called the VASP law of 2022. This law defines the FSC as the autonomous regulator for everything crypto in the British Virgin Islands.
The British Virgin Islands was already a popular jurisdiction among crypto businesses before the current license framework. It was crypto-neutral until 2020 when it enforced a sandbox regime for virtual assets service providers. The experience collected helped design the new VASP law while maintaining the sandbox regime for innovative crypto companies.
The AML-CFT laws and KYC requirements applicable are directly referred to in the VASP law and in the guidelines for registering as a VASP in the British Virgin Islands. These references make it simpler for compliance teams to get their hands on the requirements.
The BVI VASP license recognized two types of crypto activities: custody and exchange. It also leaves the door open for other activities, in a third option called “carry on the business of providing a virtual assets service”.
The minimum share capital of a crypto company in the British Virgin Islands depends on the activities undertaken. There is no exact sum defined by the regulator. The company capital should be coherent with its operation and activities.
Cryptocurrency isn’t considered a legal tender in the British Virgin Islands.
Process and Timeline: Obtaining a Crypto license in the British Virgin Islands
How to obtain the BVI crypto license in 2024 and what is the process
The process to obtain a crypto license in the British Virgin Islands includes a lot of preparation and a consequent capital to begin with. The timeline is from 6 to 12 months depending on the project complexity and proposed requirements by the regulator.
After creating a company in the British Virgin Islands, the company doesn’t need to be physically present in the British Virgin Islands, but it is required to appoint a domestic authorized representative. It must also appoint an approved auditor and an approved AML officer under the title of Money Laundering Reporting Officer.
The company must prepare a very important set of documents, schemes, policies and procedures pertaining to every aspect of its life: administration board, ownership, corporate details, compliance, technology and infrastructure, customer protection, cybersecurity, third party agreements, etc.
Once all the requirements laid out in the VASP law are fulfilled, the company can apply to
Types of licenses in the British Virgin Islands
Different types of crypto licenses in the British Virgin Islands and the covered activities
The Virtual Assets Service Providers Law of 2022 defines two main crypto activities, that requires a licensed to be performed by a company:
- to engage in the business of providing a virtual assets custody service;
- to operate a virtual assets exchange.
Both of these activities require a separate application fee of 15,000 USD. On the application side, what will differ is the subjective appreciation of the software infrastructure by the regulator. In the case of a custodial company, requirements in terms of share capital and customer assets protection will be the most important.
The VASP law also describes a third type of activity that encompasses everything that isn’t custody or exchange: to carry on the business of providing a virtual assets service.
For companies willing to provide a new and innovative service, the Financial Services Commission can register a crypto business within the Regulatory Sandbox. This specific type of license gives an 18 month period to the crypto company in order to test and demonstrate its innovative idea. It will then be granted a definitive license for its business activity afterwards.