Summary
- Bermuda is increasingly seen as a leader in blockchain regulation and the development of crypto-based financial services.
- In January 2026, the country’s prime minister, David Burt, announced plans to transition Bermuda toward becoming the world’s first fully on-chain national economy.
- The move to being on-chain is viewed as a way of lowering transaction costs, improving access to dollar-denominated payments, and keeping economic value circulating locally.
- For more stories of how crypto is being adopted worldwide, see our Crypto in Action page.
Bermuda’s attitude toward crypto
In January 2026, at the World Economic Forum’s Annual Meeting in Davos, Switzerland, Prime Minister Burt announced that, through a partnership with Circle and Coinbase, Bermuda was transitioning to become the world’s first fully on-chain national economy.
For several years, the authorities have been working to develop the infrastructure and regulatory framework to support digital assets. The aim is to use digital assets as everyday financial infrastructure.
The government has been among the world’s first to pursue a comprehensive regulatory framework designed to provide certainty and align with the highest international standards. To this end, the framework has two distinct elements: digital asset business, under the Digital Asset Business Act (DABA), and digital asset issuance, governed by the Digital Asset Issuance Act (DAIA).
As an international offshore financial center, it’s no surprise that Bermuda has been quick to adopt a business-friendly approach to digital assets. Plus, Bermuda has been well positioned to pursue this. Its small population allows for the easy rollout and testing of digital assets and frameworks. It started with what it describes as “high-volume areas,” such as the department of motor vehicles, reflecting the fact that most Bermudans have cars and/or driving licences. Similarly, legislation has been amended to ensure that digital assets are accepted for tax payments.
Legislative developments
Bermuda was one of the earliest jurisdictions to establish a comprehensive regulatory framework for crypto and blo. Its work on this dates back to 2018, and it quickly attracted companies seeking regulatory clarity.
In 2018, it introduced two significant pieces of legislation – DABA and the Limited Liability Company (Initial Coin Offering) Amendment Act 2018. Alongside these, it also issued the Digital Asset Business (Cybersecurity) Rules 2018, the Digital Asset Business (Client Disclosure) Rules 2018, and the Digital Asset Business (Prudential Standards) Rules 2018.
The DABA applies to those entities incorporated or formed both in and outside of Bermuda, and carrying on digital asset business in or from within Bermuda.
It is regarded as comprehensive, and provides both legal clarity and regulatory certainty, covering a very broad range of activities and services.
The DAIA came into force in May 2020 and specifies the activities that constitute digital asset issuance. It superseded earlier legislation introduced in 2018, since when the BMA has continued to promulgate rules and a statement of principles to supplement the legislation.
The Initial Coin Offering (ICO) Act provides a framework for ICOs that occur in, or from within, Bermuda. It also provides for two different regimes according to the type of assets issued. The Companies Act 1981, the Limited Liability Company Act and the Register of Companies regulate those launched solely for crowdfunding purposes, while ICOs involving virtual currencies or digital assets fall under the Digital Asset Business Act 2018.
Dividing up responsibilities
Infrastructure:
Bermuda has deliberately used regulated, private-sector financial companies to develop the technology infrastructure rather than building it itself.
Regulation:
The Bermuda Monetary Authority (BMA) licenses crypto exchanges, yield-bearing stablecoin structures, and decentralized finance protocols. It is part of the Global Financial Innovation Network (GFiN).
Under the DABA, the BMA enjoys far-reaching supervisory and enforcement powers, including issuing and updating regulations, codes of practice, principles, and guidance.
The Fintech Advisory Committee reviews every ICO application and makes ministerial recommendations about approval.
The Bermuda Business Development Agency (BDA) is the country’s investment promotion agency. It established a working group to investigate the underlying legal and regulatory implications for persons seeking to establish a decentralized autonomous organisation (DAO).
The DAO Working Group comprises fintech lawyers with experience and knowledge of the country’s digital asset business regime. Its aim is to draft law reform proposals seeking to give legal recognition and certainty to DAOs in Bermuda.
Key partnerships with the private sector
The authorities have been working with several firms, including Circle, Coinbase, Kraken, and MoneyGram for a number of years.
Under its sandbox licensing regulations, fully operational companies like these fall under Class F, with the sandbox allowing them to test, launch and scale up their activities in a regulated environment.
Partnerships include:
- The Stellar Development Foundation, which will support the Digital Bermuda Dollar on its blockchain network.
- Bitcoin Suisse International has dual approval under DABA and the Investment Business Act to provide regulated digital asset management and investment advisory services from Bermuda.
- Kimber Digital Assets Bermuda ISAC Ltd (known as Plume) has a Class M Digital Asset Business licence to support Bermuda with its regulated tokenized real-world asset initiatives.
- Payward (parent company of Kraken and Franklin Templeton) has a partnership focused on expanding tokenized financial products for institutional investors.
- The NEAR Foundation operates as an infrastructure partner for AI-powered public services.
Bermuda’s position on a CBDC and stablecoins
Stablecoins are a category of digital assets recognized under Bermudan law. The government has a long-standing interest in stablecoins, and one of the country’s four licensed banks, the Bermuda Commercial Bank, has said that its digital infrastructure shows that a fully compliant, lower-cost stablecoin system is technically feasible for everyday payments.
Historically, the authorities ruled out issuing a central bank digital currency (CBDC), instead partnering with Stellar for support in this area. In March 2026, Prime Minister Burt (who is also the finance minister), announced that work had started on creating a Bermudan digital dollar. Burt has said that a Bermudan digital dollar would help improve government services, would be complementary, and create the least friction in citizen-to-government services.
Digital assets like stablecoins are expected to exist alongside the traditional financial sector, with banks holding the fiat reserves that will back the digital tokens and provide local custody.
In November 2024, the BMA issued guidance on the matter, clarifying the standards it expected when considering whether a DABA-licensed organization involved in issuing single-currency pegged stablecoins was prudently conducting its business. These include having full reserve backing in high-quality liquid assets and redemption rights for holders.
Bermuda prioritizes consumer crypto protection
The authorities have put in place legislation and requirements to ensure high levels of consumer protection.
Among the acts governing this is DABA, which requires licensed businesses to conduct their business in a “prudent manner.”
The BMA has also issued a draft code of practice related to the custody of digital assets. This provides further clarity about the standards it expects from businesses when safeguarding customer assets.
Following consultations with industry, further rules came into effect during 2024 and 2025, which offer greater clarity about the applicable sections of the DABA and the DAB Code of Practice relating to the custody of client assets.
Anti-Money Laundering (AML) framework
Bermuda has a long-established reputation as an international financial center. It’s no surprise, therefore, that it has paid attention to its AML and anti-terrorist financing (AFT) regime.
It boosted this regime ahead of a Financial Action Task Force (FATF) evaluation in 2018. The DABA amended its AML laws to include businesses licensed to conduct digital asset business.
As with other elements of the digital asset legislative framework, the BMA has subsequently published guidance for regulated financial institutions.
Bermuda’s crypto taxation stance
Bermuda is noted worldwide as a low-tax jurisdiction. There are no specific taxes on income, capital gains, or other taxes on digital assets. The authorities did, however, introduce a new corporate tax regime (effective January 2025), which applies a 15% tax rate (subject to double taxation, exemption and set-off rules) on multinationals whose total revenue in a fiscal year is equal to or greater than €750 million.
Banking and payment services
Bermuda introduced one of the first digital asset business bank licensing regimes worldwide. Banking licenses can be issued to those seeking to provide traditional banking services to the digital asset sector.
In April 2025, the BMA issued a discussion paper relating to payment service providers. It is seeking to create a Payment Services Act to replace the Money Services Business Act 2016. The authorities are looking to introduce a modern, risk-based framework tailored to the payment services sector.
Crypto mining
DABA doesn’t cover digital asset mining and as a result, this is currently an unregulated activity. That said, the BMA notes the stance of other jurisdictions and expects any Bermudan company conducting mining activity overseas to be wholly compliant.
Timeline of key crypto and blockchain developments in Bermuda
2017
In a speech given by Prime Minister Burt, the government outlined its position on cryptocurrencies.
It was announced that the Bermuda Crypto Association was in the process of being formed and would operate as a self-governing organization.
2018
Bermuda introduced a regime to govern initial coin offerings, as well as digital asset businesses.
The jurisdiction made further enhancements to its AML/ATF regime ahead of its fourth-round mutual evaluation by the FATF.
The FinTech Development Fund was established.
2019
Circle (at the time, operating the Poloniex digital asset exchange), transferred the exchange’s operations to Bermuda. It praised the country’s “exceptionally well-designed and comprehensive regulatory framework.”
2020
The DAIA came into force in May, superseding legislation that had been introduced in 2018 to regulate individuals carrying out digital asset offerings.
2023
The BMA issued the Digital Asset Business (Cyber Risk) Rules 2023 to replace the Digital Asset Business (Cybersecurity) Rules 2018, and which became effective January 1, 2024.
Coinbase launched its Coinbase International Exchange derivatives platform from Bermuda.
2024
In November, the BMA issued the Digital Asset Business Single Currency Pegged Stablecoin (SCPS) Guidance.
In late 2024, the BMA issued the world’s first license for a DAO-governed decentralized derivatives exchange.
2025
In April, the BMA issued a Payment Service Provider Regulatory Framework Discussion Paper ahead of creating a new Payment Services Act to replace the Money Services Business Act 2016.
In May, the Bermuda Digital Finance Forum saw Coinbase and Circle airdrop 100 USDC tokens to attendees so they could explore stablecoin usage through local merchants.
In July, the BMA published a discussion paper about the responsible use of AI in the financial services sector.
In August, Bermuda hosted digital finance leaders for the launch of the Bermuda Stablecoin Association (BSA) and a Digital Finance Roundtable.
2026
In January, at Davos, the government announced plans to transition the country toward what it described as the world’s first fully on-chain national economy, in partnership with Circle and Coinbase.
In March, Prime Minister Burt revealed the island was preparing for a digitally native Bermudan dollar.
In May, the cabinet approved policy proposals to advance Bermuda’s digital finance legislative framework, including modernizing the FinTech Development Fund, updating the Public Treasury Administration and Payments Act, and amending the Public Funds Act.
Outlook
Bermuda is one of the world’s most advanced crypto hubs in terms of legislative clarity and regulatory robustness. The authorities have created legislation that sets boundaries rather than prescribing business models, allowing a fast-moving market to evolve and innovate.
It has been important – particularly given the country’s size and resources – for Bermuda to collaborate with the private sector to help create a vibrant, transparent, and accountable crypto and blockchain sector. There is no sense that this type of partnership approach will change, with further innovation expected instead.
The BMA will continue to test different aspects of digital assets and routinely reassess existing legislation to ensure it continues to meet its intended purpose.
