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Regulatory Requirements for Virtual Assets and Digital Tokens

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The regulatory landscape for virtual assets and digital tokens varies across jurisdictions. This article provides an overview of the key requirements and considerations for several countries.

Belize: A Comprehensive Framework

Belize has established a robust framework to regulate investment activities involving virtual assets and digital tokens through the Securities Investment Business Act (SIBA).

Key Requirements

  • License: A person carrying on an investment business activity requiring a license under SIBA must meet two conditions:
    • The product satisfies the definition of an investment as outlined in SIBA.
    • The investment activity is not excluded pursuant to Part B of Schedule 2 of SIBA or the person is not an excluded person pursuant to Part C of Schedule 2 of SIBA.

Examples of Licensed Activities

  • Custodian services for virtual assets
  • Operating an exchange that buys and sells virtual assets or digital tokens

Belize: Additional Regulations

In addition to SIBA, the Financing and Money Services Act, 2009 (FMSA) regulates money services business, including the transmission of money in any form.

Key Considerations

  • Virtual asset transactions: Virtual asset transactions are not considered “money” under FMSA. However, it is recommended to consult with the Commission before proceeding with such activities.

Global Perspective: A Lacking Framework

While many jurisdictions have yet to enact laws governing cryptocurrencies, some countries have taken a proactive approach:

Countries with Clear Regulations

  • Israel: Treats crypto mining as a business subject to corporate income tax or other regulations.
  • Canada: Also treats crypto mining as a business subject to corporate income tax or other regulations.

The regulatory landscape for virtual assets and digital tokens is complex and evolving. It is essential to stay informed about the specific requirements in each jurisdiction to ensure compliance with applicable laws and regulations.