The global cryptocurrency platform announced it was awarded a conditional licence by Cayman’s financial regulator, marking a key progression for the jurisdiction’s burgeoning digital asset sector.
On 5 Jan. Crypto.com revealed that the Cayman Islands Monetary Authority had granted it a conditional Virtual Asset Service Provider licence. That matters because it shows that leading digital asset businesses – the company has 150 million users – are committing to the Cayman Islands.
Key moment
“Having tier 1 exchanges like Crypto.com upgrading their regulatory position in Cayman is an ongoing vote in favour of the Cayman Islands,” said Michael Bacina, co-founder at NXT Law and deputy chair at the Blockchain Association of the Cayman Islands. “It’s exciting to see one of the major global exchanges investing in the Cayman Islands and receiving due recognition for their hard work.”
Following the introduction of the VASP Act in 2020, CIMA required all digital asset businesses in the islands to register. But in 2024 Cayman updated the VASP Act to require that digital asset custodians and trading platforms – which potentially carry greater risk – must apply for licences.
Crypto.com’s decision to publish the news of its conditional licence – other companies may also have reached this stage but not made an announcement – gives an insight into Cayman’s evolving digital asset regulatory landscape.
“We expect to see more VASP licences approved as CIMA and the Cayman government continue to support and embrace responsible innovation, helping maintain Cayman’s position as a leading destination for Web3 business,” said Bacina.
According to a Crypto.com press release, the company expects to receive its full authorisation from CIMA in the coming months following the submission of all remaining material requirements.
What Cayman offers
For Cayman the news is a sign that its efforts to attract international digital asset businesses are working. But Crypto.com co-founder and CEO Kris Marszalek said it will also benefit his company.
“We are tremendously proud to be our industry’s leader in licences and registrations, and to now be among the first digital asset firms to receive this approval in the Cayman Islands. We look forward to continuing to build on our service offerings in line with market regulations.”
“Businesses which can meet CIMA’s licence requirements can give customers confidence that they have thoughtful systems and robust compliance,” said Bacina.
That’s particularly relevant for attracting traditional financial institutions, such as hedge funds, to feel comfortable investing in digital assets such as cryptocurrencies or non-fungible tokens. In its press release the company made it clear that Cayman’s ecosystem of institutional investors is part of the appeal.
“This approval will enable Crypto.com to further its product and service portfolio in the Cayman Islands, particularly through the Crypto.com Exchange – Crypto.com’s institutional-grade offering for advanced traders and institutions,” said the press release.
Crypto.com’s announcement comes just a month before the inaugural Cayman Crypto Week – a conference that should serve as another useful barometer of Cayman’s progress in establishing itself a digital assets hub.
