BRITISH VIRGIN ISLANDS Law and Practice Contributed by: Chris Duncan and Katrina Lindsay, Carey Olsen
Carey Olsen Rodus Building PO Box 3093 VG1110 Tortola Road Town
British Virgin Islands Tel: +1 284 394 4030 Email: chris.duncan@careyolsen.com Web: www.careyolsen.com
1. Fintech Market 1.1 Evolution of the Fintech Market In the past 12 months, a flurry of approvals have been issued by the BVI Financial Services Com - mission (FSC) under the Virtual Assets Service Providers Act 2022 (the “VASP Act” ), which came into effect on 1 February 2023. The VASP Act bolsters steps previously taken by the BVI finan - cial services industry in recent years to embrace digital innovation and to encourage fintech and other Web3 and blockchain businesses to set up in the BVI. These steps include the launch of the regulatory sandbox for fintech businesses to conduct live-testing before they launch (dis - cussed further in 2.5 Regulatory Sandbox ) and the launch of Bank of Asia as one of the world’s first fully digital global banks. The next 12 months are expected to involve fur - ther exploration of BVI vehicles to accommo - date developments in the blockchain and crypto industry, including the use of companies limited by guarantee. As technological innovations advance, interna - tional standards will also continue to evolve. In this regard, it is anticipated that international
pressure on the BVI to adopt the OECD’s Cryp - to-Asset Reporting Framework requirements into domestic law will increase during the course of the next 12 months. 2. Fintech Business Models and Regulation in General 2.1 Predominant Business Models New entrants are driving the adoption of fintech business models in the BVI. The fintech busi - ness models that currently predominate in the BVI include: • lending and credit, with platforms offering alternative lending options, peer-to-peer lend - ing, and loan marketplaces; • blockchain and cryptocurrency, with com - panies leveraging blockchain technology for various financial applications, including centralised and decentralised virtual asset exchange platforms; and • digital payments, with companies providing digital payment solutions such as non-custo - dial multi-signature wallet solutions.
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