The Cayman Islands Ministry of Financial Services introduced a package of laws designed to create a favourable environment for virtual asset service providers (VASP).
The new rules are aimed at aligning the regulation of companies in the territory with FATF standards. The FATF is currently conducting a corresponding assessment of Cayman authorities’ efforts.
As part of the first phase, which began on 31 October, the AML/CFT rules will come into effect. VASPs already operating or planning to do so in this jurisdiction must register with the Cayman Islands Monetary Authority and comply with these rules.
The second phase will begin in June, involving licensing requirements and prudential supervision of VASP activities.
The Virtual Assets Act, with amendments from 2020, which will streamline the implementation of the new rules, will be presented at the next session of the Cayman Islands Legislative Assembly.
Earlier in October, the EU excluded the Cayman Islands from the offshore blacklist.
In a recent leak of U.S. Financial Crimes Enforcement Network (FinCEN) secret documents, the Cayman Islands are mentioned in 652 transactions.
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