Bermuda digital assets - October 2026 update
Our Bermuda update highlights three significant regulatory initiatives issued by the Bermuda Monetary Authority ("BMA") that continue Bermuda's commitment to maintaining a progressive, risk-based and innovation-friendly regulatory framework for digital assets, tokenisation, stablecoins and emerging technologies.
The Bermuda Monetary Authority continues to refine and expand its regulatory framework to ensure Bermuda remains at the forefront of digital asset innovation while maintaining high standards of consumer protection, market integrity and financial stability. Building on its established regulatory regimes under the Digital Asset Business Act 2018 ("DABA") and Digital Asset Issuance Act 2020 ("DAIA"), the BMA has advanced several initiatives throughout 2026 aimed at addressing the growing adoption of tokenisation, stablecoins and artificial intelligence across the financial services sector.
During 2025 and 2026, the BMA issued the following key consultations and discussion papers:
Responsible Use of Artificial Intelligence in the Financial Services Sector
In July 2025, the BMA published its discussion paper entitled "The Responsible Use of Artificial Intelligence in Bermuda's Financial Services Sector", seeking industry feedback on the use of artificial intelligence ("AI") across Bermuda's regulated financial services industry.
The discussion paper considered the opportunities and risks associated with AI adoption and proposed an outcomes-based, technology-neutral supervisory approach focused on governance, accountability, risk management, operational resilience, cyber risk and third-party oversight.
Following consultation, the BMA issued a stakeholder letter in February 2026 confirming broad industry support for a principles-based regulatory approach, and that the BMA's approach is to integrate AI-related risks within existing regulatory frameworks and enterprise risk management arrangements while continuing to develop supervisory guidance in this area.
Asset Tokenisation Consultation
In November 2025, the BMA published its Discussion Paper: "Asset Tokenisation", seeking industry feedback on whether Bermuda's existing digital asset, investment funds and insurance regulatory frameworks appropriately accommodate emerging tokenisation activities.
The objective was to provide greater clarity in the market and to support the continued development of tokenisation in Bermuda. The discussion paper examined the tokenisation of investments, investment funds, insurance products and other real-world assets, and considered matters such as licensing perimeters, the interaction between existing regulatory regimes, investor protection, market conduct, cyber risk and financial stability.
Following industry consultation, the BMA published a stakeholder letter in March 2026 together with a subsequent consultation paper outlining proposed policy directions and legislative and regulatory enhancements intended to provide greater clarity for tokenised products and services operating within Bermuda's financial services sector.
Of particular note, it was determined that Bermuda's existing DAB regime adequately addressed the concerns raised and that rather than creating new law and regulation, the drive should be to streamline the existing regulation.
Stablecoin Use in Insurance and Investment Funds Consultation
In July 2026, the BMA issued a consultation paper on a proposed Guidance Note on the Use of Recognised Stablecoins within Bermuda Insurance, Insurance-Linked Securities and Investment Fund Structures.
The proposed guidance is intended to clarify the BMA's supervisory expectations regarding the use of recognised stablecoins by eligible regulated entities for specified operational, settlement, treasury and investment related purposes.
The consultation reflects the BMA's recognition of the increasing role of stablecoins in institutional financial markets while emphasising that their use should be supported by appropriate prudential and risk management safeguards.
Frequently asked questions
常见问题解答
What is the Bermuda Monetary Authority's approach to regulating artificial intelligence in financial services?
The BMA has adopted a principles-based, outcomes-focused approach to AI regulation. Rather than creating new standalone regulations, the BMA is integrating AI-related risks within existing regulatory frameworks and enterprise risk management arrangements. Their approach emphasizes governance, accountability, risk management, operational resilience, cyber risk, and third-party oversight, while being technology-neutral to accommodate ongoing AI innovation in the financial services sector.
What are the main digital asset laws currently in effect in Bermuda?
Bermuda has two primary pieces of digital asset legislation: the Digital Asset Business Act 2018 (DABA) and the Digital Asset Issuance Act 2020 (DAIA). These acts form the foundation of Bermuda's regulatory framework for digital assets and have been established to ensure consumer protection, market integrity, and financial stability while supporting innovation in the digital asset space.
How is Bermuda regulating asset tokenisation?
Following consultation with the industry in 2025-2026, the BMA determined that Bermuda's existing Digital Asset Business (DAB) regime adequately addresses tokenisation concerns. Rather than creating new laws and regulations, the BMA is focused on streamlining existing regulations to provide greater clarity for tokenised products and services, including tokenised investments, investment funds, insurance products, and other real-world assets operating within Bermuda's financial services sector.
Can insurance companies and investment funds in Bermuda use stablecoins?
Yes, the BMA issued guidance in July 2026 regarding the use of recognised stablecoins by eligible regulated entities in the insurance and investment fund sectors. Stablecoins can be used for specified operational, settlement, treasury, and investment-related purposes, provided their use is supported by appropriate prudential and risk management safeguards as outlined in the BMA's supervisory expectations.
What consultation process does the BMA follow when developing new digital asset regulations?
The BMA follows a transparent consultation process that includes publishing discussion papers to seek industry feedback, engaging with stakeholders, and then issuing stakeholder letters summarizing the feedback received. Following this, the BMA publishes consultation papers outlining proposed policy directions and any legislative or regulatory enhancements. This collaborative approach ensures industry input is considered before implementing new regulatory frameworks or guidance.
