Bermuda to Amend its Banking Act to Keep Up With Crypto

Justine Pope
  • New Banking Act to aid crypto organizations
  • Banks aversion to risk, hampering development of fintech sector
  • Bermuda’s legislation must respond or be left behind

The Government of Bermuda will make changes to its Banking Act in order to establish a new class of bank to help deliver services to local fintech and blockchain organizations.

This new announcement follows a recently created ICO Bill and Digital Asset Business Act which were drawn up to attract companies in the blockchain and virtual currency space.

The new Banking Act follows consultations with local banks, which have so far been unwilling to provide banking services to the new class of companies converging on the island after the ICO Bill was passed, citing regulatory barriers and an aversion to risk.

In a statement to the House of Assembly this week, the Premier and Minister of Finance David Burt said the banks’ stance "Cannot be allowed to frustrate the delivery on our promise of economic growth and success for Bermudians”. He added:

The fintech industry’s success globally depends on the ability of the businesses operating in this space to enjoy the necessary banking services. In other jurisdictions, banking has been the greatest challenge and for us in Bermuda, it is equally so and therefore it must be resolved. Their reticence, no matter how well-founded, cannot be allowed to frustrate the delivery on our promise of economic growth and success for Bermudians.

David Burt

Burt highlighted that the future belongs to those who can quickly lay a foundation for growth and Bermuda must respond to emerging trends in Banking, otherwise it would be left behind.

In April, Bermuda signed a $15m MOU with Binance Group, to establish funding for educational programs related to fintech and blockchain. Binance reportedly plans to develop a global compliance base in Bermuda, and in May, the Government signed an MOU with Shyft network, which will reportedly provide $10m on blockchain technology education and economic development on the island.