The British Virgin Islands is positioning itself to emerge as a world-leading hub for the burgeoning digital assets sector, anchored by a robust new regulatory framework and ecosystem for innovative fintech businesses, according to Deputy Premier and Minister for Financial Services Hon. Lorna Smith, OBE.

Addressing the International Arbitration Centre conference, Smith outlined the Territory’s roadmap to capitalize on its first-mover advantage, strong financial services expertise, and collaboration with industry to create a thriving and trusted digital assets market.

“We, in the BVI, are conscious that the emergence of the digital assets business sector signifies a revolutionary shift in the financial world, one in which we aim to play a critical role,” the Deputy Premier stated. “As an agile, innovative and respected financial services jurisdiction, I believe that the BVI is perfectly placed to be at the forefront of this effort and it is our objective to be a major global hub.”

Central to this ambition is the Virgin Islands’ newly minted Virtual Assets Service Providers Act (VASP), which establishes the legal framework for registering and supervising virtual asset service providers under rigorous regulatory oversight.

Smith emphasized the VASP legislation was carefully crafted in close consultation with industry leaders to address the unique challenges and risks inherent to the rapidly evolving digital assets space.

Key elements include stringent anti-money laundering measures that require providers to demonstrate effective risk management in compliance with global standards.

Higher-risk offerings like custodians and exchanges face even stricter obligations.

The Deputy Premier highlighted cross-border collaboration as “critical for digital assets”, with the BVI actively coordinating with regulators worldwide to ensure providers operating in multiple jurisdictions meet all relevant compliance requirements.

“We are already seeing many of them approach compliance with a renewed sense of clarity and understanding around the necessity of strict legislation,” Smith said. “It is my hope that the BVI will be at the heart of these developments.”

With over 60 VASP license applications received to date, the Territory is swiftly moving to harness its reputation and professional services expertise to establish “a comprehensive and secure environment” for the digital assets industry.

Smith underscored an overarching mission to create “a dynamic ecosystem populated with innovative, dependable, and trusted providers with state-of-the-art and effective regulation as its beating heart.”