Assistance in obtaining the Cayman Islands crypto license. Pricing and more information by contacting our team of cryptocurrency lawyers Cayman Islands.
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The Cayman Islands are one of the most notorious offshore jurisdictions for business, especially in the financial services industry. It is not a surprise that it became a haven for the digital assets and virtual assets sector as well. Since the application, enforcement and development of the VASP Act, the Caymans have become a reputable option for asset service providers VASPs offering the provision of financial services related to virtual assets, including trading platforms, custody, and virtual asset issuance.
To receive the VASP license in the Cayman Islands, a crypto project should prepare itself to respond to numerous requirements. The Cayman Islands Monetary Authority has issued clear guidelines, in addition to the content of the Virtual Asset Services Providers law, in order to lead crypto companies into structuring a proper application file.
| Duration | 4-7 months |
| Local office | Registered office only |
| Local director | The directors can be remote |
| Accounting and auditing | Audits for the License regime (not for the Registration regime) |
| Economic substance | Minimal |
| Government fee | Yes (depending on the chosen tier) |
| Corporate income tax (CIT) | No (territorial corporate taxation) |
| Withholding tax (WHT) | 0% |
A legal entity should be formed in the Cayman Islands, with a registered office. This is the compulsory step number one to the Cayman Islands crypto license.
On the corporate level, the applicant to the VASP license in the Caymans should disclose information about the organization and the structure of the company. The CIMA expects at least the three following pieces of information from candidates:
A chart detailing the group’s companies and ultimate beneficial owners;
Among the entities composing the group, a detail of the regulated entities and their regulated activities;
All the services provided, group-wise, by any entity related to the VASP.
The CIMA will pay close attention to the people involved in the VASP company. The board, the team members and the managers will be required to pass a fit & proper check. In addition, the applying company should prepare, at least:
Resume, diplomas and other certificates demonstrating professional qualification;
Certificates of non criminal record;
Professional and financial references;
A notarized document of identity with a photo;
Declaration of source of funds and source of wealth with supporting evidence for major shareholders;
Detail of every shareholder holding 10% or more of the company;
A personal questionnaire issued by the CIMA.
Next comes the business activity and the virtual assets services to be provided by the new licensed company. The CIMA suggests presenting a single document in the form of a business plan, that should include at the very least the following information:
A description of the business activity;
A description of the products and services being offered or to be offered in the future;
Financial projections and statements on a 2 years sight;
Description of the physical place of business (can be outside the Cayman Islands);
Information about the customers (targeted markets, number of customers, location, etc);
Information regarding third parties (affiliates, service providers and outsourcing companies) including their location and regulatory framework.
Finally, the application should include forms, policies and any supporting documents on the matter of compliance with Cayman and international laws. The goal for the CIMA is to get a clear overview of the risks and how they are mitigated by the company:
AML-CFT policies;
Cybersecurity policies (must be compliant with the CIMA’s cybersecurity guidelines);
Information on the Chief Information Officer or Chief Information Security Officer, responsible for ensuring the safety and security of customers’ personal data and virtual assets;
Appointment of an approved officer with responsibility for the procedures for combating money laundering, terrorist financing and proliferation financing;
Implementation and demonstration of compliance with the Travel Rule (can be included in the AML policies);
Transaction flow charts;
The application fee and license fee if applicable.
Obtaining a crypto license in the Cayman Islands isn’t a long process. It consists of three major steps: registering a legal entity, preparing the application, and carrying out the application. The difficulty lies in having all of the required documents and information ready and validated by the regulator.
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