The Isle of Man authorities equalize cryptocurrencies with traditional investment assets
The authorities of the Isle of Man, a self—governing land of the British Crown, actually offshore, are going to change local legislation, consolidating the concept of cryptocurrency in order to comply with anti—money laundering (AML) and terrorist financing (CFT) rules.
The Local Financial Services Authority (FSA) has announced public hearings on amendments to the current legal framework. Despite the fact that most of the crypto companies on the island are already registered in accordance with the rules of AML and CFT, the agency considers it necessary to more strictly monitor cryptocurrencies.
One of the options for amendments implies the preservation of the current norms established by the Law on Registration and Supervision of Enterprises of 2015. However, the FSA believes that this approach does not fully protect cryptocurrency holders, especially retail customers, from possible financial losses.
The agency proposed to expand the definition of "investment" to include crypto assets. This will require crypto companies to comply with investment standards in traditional assets, and these standards may partially apply to the entire cryptocurrency market.
The FSA is exploring the possibility of developing a separate regulatory framework for virtual asset service providers (VASPs) and cryptocurrency issuers. The new requirements can be modeled on the European Union's Cryptocurrency Regulation Act (MiCA), which is due to come into force by the end of the year. The Isle of Man is not part of the EU, but the adoption of regulation similar to MiCA will simplify the supervision of the cryptocurrency industry, local authorities are confident.
