The Cayman Islands are a British dependent territory. For the whole world, the Cayman Islands are known as well-developed and well-functioning financial services center, the main segments of which are insurance, banking and trusts management.
The islands occupy a relatively small area – 264 square meters, however, more than 100 thousand firms are registered there, about half a thousand banking institutions and about 800 organizations providing insurance services. In addition, the Caymans have become the place of registration of the largest number of investment companies in comparison with other jurisdictions. In addition, the Cayman Stock Exchange has been recognized by the London Stock Exchange, which means that securities listed on this exchange can be listed on the LSE international market. In terms of working capital, the Cayman Islands ranked 5th in the world. It is equal to $ 1.5 trillion.
The Cayman Islands have a solid legal framework. With all this, the regulatory authorities, so far, have not introduced any special requirements for conducting an ICO or carrying out crypto-transactions within this island state. Thanks to such a policy and a lower cost level compared to Singapore or, for example, Switzerland, the islands are attracting an increasing number of entrepreneurs who want to engage in activities whose business core is cryptocurrencies and blockchain.
The Cayman Island Monetary Authority (CIMA) has not yet shown a concrete opinion on the regulatory status of the cryptocurrency and the order of its turnover. Therefore, the cryptocurrency, now, is in a certain “gray zone”.
At the same time, the Money Services Law (MSL) may regulate the use of a crypto-coin as a means of payment. The provisions of this legislative act stipulate that in order to carry out financial transactions, legal entities must obtain an appropriate license permit from CIMA.
Despite the fact that the regulators do not have a clear position on ICOs, all tokens that are issued inside the Cayman Islands are conventionally divided into three types:
The Monetary Service Law (MSL) can regulate the use of tokens and cryptocurrencies, as crypto transactions can be regarded as financial services. Therefore, the company must obtain the appropriate authorization from CIMA.
MSL states that monetary services include the following:
In addition, the companies are obliged to comply with the AML legal regime.
The activities carried out by such funds and the procedure for registering them are regulated by the Mutual Fund Law (MFL). In this case, the company must also apply to CIMA for appropriate authorization. It is necessary that the shares of the firm meet the following criteria:
In accordance with the Law, there are three available forms of regulation of mutual investment funds:
The fund is not required to be licensed or provided with a head office by the Cayman Islands mutual fund administrator. The fund is simply registered with the Authority by submitting an application along with an approved form (Form MF1) and paying a fee of $ 4,268.
Eternity Law International lawyers of are ready to provide you with qualified support and assistance in setting up a fund organization under the jurisdiction of the Cayman Islands. If you have any questions, please contact us by phones mentioned on the website or use the CRM form.