Is the Isle of Man a new safe haven for UK crypto companies?

Quick take

1 minute read

  • How the Isle of Man can benefit UK crypto companies.
  • How the island could rescue 150 companies related to blockchain.

Earlier this year in October, the financial watchdog of the Isle of Man gave some clarity as to how the island will be treating the world of crypto assets in the future. The FSA (Financial conduct authority) said that the perimeter guidance is primarily aimed at providing companies with a more clear roadmap when it comes to setting up a business in relation to the blockchain or crypto space in their jurisdiction.

Earlier this month, however, the chief executive officer of the blockchain regulation specialists at SolutionsHub, Lee Hills as explained why the Isle of Man has such a big support for the world of crypto and how it could come to the rescue for more than 150 businesses that have currently been left with unanswered questions by regulators in the United Kingdom.

Currently waiting for financial conduct authority registration in the UK is a significant backlog of numerous crypto-related companies. Many of them have been waiting for months to experience some sort of clarity around their company and future.

With only a small number being registered so far, time seems to be running out. If they’re not registered by the 10th of January, they will be forced to end their operations according to the authority.

Countries of the European Union also have until next month to bring their domestic laws into full compliance with the 5th money-laundering directive (5MLD).

Prior to that date though (10th of January), legislation is to be updated by each member of the EU. Some countries have yet to complete the process though.

5MLD puts companies related to the world of crypto under the requirements of the ML directives. This means that they will have obligations in regard to due diligence when they bring on new clients.

The authority has previously said that the specific treatment will all depend on the nature of the token and will be considering its substance rather than its form.

So even though bitcoin and other alternative crypto assets will fall out of regulatory oversight, companies to operate with these assets will need to register with your authority as a “designated business“. As a result of this, they will need to comply with all the anti-money-laundering protocols and countering the financing of terrorism requirements.

Interestingly, these companies will not require a financial services license but those who are carrying out these kinds of activities will be regulated by the authority.

The Isle of Man is well known for welcoming blockchain-related businesses with open arms. Of course, as a business owner in the run-up to Christmas following the year of 2020 and the coronavirus pandemic, there will surely be a lot of things to think about.

The Isle of Man is also well known for supporting businesses as they relocate and launch their companies. Especially when they have come from jurisdictions where regulations are harsh or they have experienced trouble with the regulators. As a result of all this, the Isle of Man could become a safe haven for UK crypto companies that have been left in the dark.

For more news on this and other crypto updates, keep it with CryptoDaily!

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