Vanuatu has officially completed its crypto regulation and licensing framework, marking a crucial milestone in its digital asset oversight.
Recently, the Vanuatu Parliament passed the Virtual Asset Service Provider (VASP) Act, granting the Vanuatu Financial Services Commission (VFSC) the authority to license and regulate the crypto industry, as reported by Finance Magnates.
The bill empowers the VFSC to issue licenses to crypto exchanges, NFT marketplaces, and custody providers. Additionally, banks can obtain licenses to offer crypto exchange and custody services. However, the legislation excludes stablecoins, tokenized securities, and central bank digital currencies, marking a clear scope for the regulatory framework.
One of the key features of the legislation is its provision for a sandbox environment, allowing approved companies to operate as virtual asset service providers for up to one year, with the possibility of renewal. This will provide a controlled space for companies to test and refine their services under regulatory supervision.
Vanuatu is updating its crypto regulation and licensing frameworks. Recently, the Cayman Islands revised its crypto licensing regulations, requiring virtual asset service providers (VASPs) to obtain a license from the Cayman Islands Monetary Authority starting April 1. This move highlights the region’s commitment to regulatory clarity in the cryptocurrency sector.
Similarly, Taiwan’s Financial Supervisory Commission released a draft for the VASP Act on March 25, establishing licensing requirements for crypto asset service providers, setting standards for stablecoin issuance, and introducing investor protection measures. Similarly, Turkey implemented stricter regulations for crypto asset service providers on March 13, highlighting a global trend towards increased oversight in the cryptocurrency industry.
These developments align with the growing institutional interest in crypto, as highlighted by Steve Kurz, who emphasizes that evolving regulatory frameworks are crucial for sector growth. Major investors now see crypto as a viable investment, and with improved market performance and Bitcoin ETFs gaining traction, regulatory clarity could further boost institutional participation in the space.
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