BRITISH VIRGIN ISLANDS Law and Practice Contributed by: Chris Duncan and Katrina Lindsay, Carey Olsen
2.2 Regulatory Regime VASP Act
• providing kiosks (such as automatic teller machines, Bitcoin teller machines, or vend - ing machines) for the purpose of facilitating virtual assets activities through electronic terminals to enable the owner or operator of the kiosk to actively facilitate the exchange of virtual assets for fiat currency or other virtual assets; or • engaging in any other activity that, under the guidelines, constitutes the carrying on of the business of providing a virtual asset service or issuing virtual assets or being involved in virtual asset activity. Whether an entity is carrying on a virtual assets service will turn on, among other things, whether the asset in question constitutes “virtual asset” . By way of example, crypto-based derivative products would require more careful considera - tion and may be caught by the VASP Act and/ or the Securities and Investment Business Act (SIBA). Similarly, consideration should also be given to the list of excluded activities that would take a BVI company outside the scope of the VASP Act, such as solely creating or selling a software application or virtual asset platform. SIBA SIBA provides the framework for the licensing, regulation and supervision of investment busi - ness carried on in or from within the BVI. SIBA provides that no person shall carry on, or hold themself as carrying on, investment business of any kind in or from within the BVI unless they hold a licence authorising them to carry on that kind of investment business. The term “investment business” is widely defined and covers: • dealing in investments; • arranging deals in investments;
The VASP Act provides the framework for the licensing, regulation and supervision of virtual asset service providers (VASPs) providing virtual assets services in or from within the BVI. The VASP Act defines “VASP” as a business that provides a virtual assets service and is registered to conduct one or more of the following activities or operations for or on behalf of another person: • exchange between virtual assets and fiat cur - rencies; • exchange between one or more forms of virtual assets; • transfer of virtual assets, where the trans- fer relates to conducting a transaction that moves a virtual asset from one virtual asset address or account to another on behalf of another person; • safekeeping or administration of virtual assets or instruments enabling control over virtual assets; • participation in, and provision of, financial services related to an issuer’s offer or sale of a virtual asset; or • performance of such other activity or opera - tion as may be specified in the VASP Act or as may be prescribed by regulations. A person engaged in any of the following activi - ties or operations, for or on behalf of another person, will be deemed to be carrying on a vir - tual assets service: • hosting wallets or maintaining custody or control over another person’s virtual asset, wallet or private key; • providing financial services relating to the issuance, offer or sale of a virtual asset;
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