Isle of Man Preparing to Pass Digital Currency Regulatory Framework
The Isle of Man wants to become a leading Bitcoin hub and attract digital fintech businesses, entrepreneurs and developers, Business Insider reports. The government of the tiny island is about to pass a new regulatory framework to create a true paradise for digital currencies.
The Isle of Man is a self-governing British Crown dependency located in the Irish Sea between the islands of Great Britain and Ireland.
While the United Kingdom is responsible for the island’s defense and foreign policy, the local parliament and government have power over all domestic matters. Business regulations and tax incentives are domestic matters, so the island has the freedom to pass innovative legislation and tax incentives to attract digital fintech firms and professionals.
In fact, the Isle of Man has long been a favorite location for online businesses that need a permissive regulatory climate. For example, it has a world-class reputation as an online gaming and sports betting hub that offers a friendly and agile regulatory environment to the operators and at the same time provides strong legal protection to their customers worldwide.
The new regulatory framework for digital fintech will be informed by the same principles, and may permit restoring the support of the leading U.K. banks that in 2014, scared by the high volatility of bitcoin, stopped working with the digital currency industry on the island.
Brian Donegan, the Isle of Man’s head of operations for digital development and e-business, told CoinDesk that the government is moving aggressively to put key measures in place that would help the region’s budding digital currency industry thrive.
The Proceeds of Crime Act, which has been altered to account for digital currencies, is expected to come into force at the start of April. A new legislation, the Designated Businesses Bill, will regulate the activities of businesses responsible for holding sums of money, including Bitcoin exchanges.
Peter Greenhill , head of e-commerce for the Isle of Man, told Business Insider that the aim is to be the most attractive place in the world for cryptocurrency companies to work from, with “friendly but firm legislation” for digital currency startups.
“We have the regulations and infrastructure in place to become a world leader in digital currencies,” he said. “We already have companies coming in and setting up. We see this as the future and we want to be at the center of development in this area.”
It may seem odd that firmly enforced regulations are presented as an advantage for companies operating in a frontier industry that is often threatened by regulators, but Greenhill considers it a necessary step to foster trust in the use of digital currencies.
“These companies will be listed on a register that will be strictly controlled by the island’s Financial Supervision Commission,” he told Computer Weekly. “They will hold their records, have them audited, looked at, and if they see something untoward they’ll take those people off that register and make sure the world knows about it. We set the bar high, and if people don’t meet [our requirements], they can go somewhere else.”
It appears that the Isle of Man is aligning with the current trend of fostering the emerging Bitcoin economy and taking it mainstream, but under a firm regulatory framework.
Isle of Man image via Flickr.