Bermuda Amends Banking Act To Accommodate Blockchain
The Bermudian Government has announced its upcoming plans to amend the
Banking Act so that they can establish an all-new class of bank in order to render
services to the local Blockchain and Fintech organizations, as reported by Finextra
on July 2.
This amendment has been carried out due to the fact that the local banks have
apparently refused to offer any kind of banking services to these new companies,
being apprehensive about the potential risks and regulatory issues. This is how the
Government has come up with this new regulation wherein an update to the prior
Banking Act will be developed to resolve this issue.
The Minister of Finance, David Burt and the Bermudian Premier commented in the
context of introducing this bill in the parliament that the banks’ stance “cannot be
allowed to frustrate the delivery on our promise of economic growth and success for
Bermudians.” He went on to add, “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.”
Bermuda has worked tirelessly in order to strengthen its blockchain and its crypto-
friendly position. In May this year, the Government of this British Island Territory
also signed an MOU (Memorandum of Understanding) with Shyft network. This will
provide a sum of $10 million for the economic development and blockchain
technology education on the island.
In April this year, Bermuda also signed an MOU of $15 million with Binance Group.
Binance Group is the company behind the leading cryptocurrency exchange called
Binance. This MOU was signed in order to establish funding for all the educational
programs associated with Blockchain and Fintech. Apparently, Binance now has
plans to grow a “global compliance base” on the island. According to Burt, this
move is bound to add at least 40 new jobs, around 30 of which will undoubtedly go
the way of the Bermudians.
It has become rather challenging for some organizations in Bermuda to stay in
business because of banks’ refusal to offer their services to blockchain companies
and crypto exchanges. This has prompted some to even move to other countries
that offer more friendly regulatory environments.