The Virtual Asset (Service Providers) Act, 2020 (Revised) (VASP Act) requires all virtual asset service providers (VASPs) providing virtual asset services to be registered or licensed with the Cayman Islands Monetary Authority (CIMA).
A transitional period allowed existing VASPs operating before 31 October 2020 to continue operations until 31 January 2021 while they made an application to register with CIMA. Recent changes now permit those existing VASPs to continue operations beyond 31 January 2021 provided that they have applied to register as a VASP with CIMA by 30 January 2021. If the VASP’s registration is accepted by CIMA, we expect that its registration date will be the date on which the application was made.
However, if an existing VASP fails to submit a registration application at all by 30 January 2021 it must prepare to suspend operations on 31 January 2021 and immediately submit a new or rectified application before starting to operate again.
The position for all other VASPs – as set out in our client alert of 4 November 2020 - remains unchanged.
Operating in breach of the VASP Act without an appropriate registration or licence in place could mean that VASPs and their operators are committing criminal offences or will be subject to administrative fines from CIMA.
You should contact your usual Harneys contact with any questions.