British Virgin Islands digital assets - December 2025 update
Our British Virgin Islands update explores how the Virtual Assets Service Providers Act (the "VASP Act") does not currently regulate the primary issuance of tokens and why this is beneficial to the jurisdiction's digital asset industry.
The BVI continues to be the jurisdiction of choice for token issuers and for token generation activities. This is on the basis that the BVI Virtual Assets Service providers Act, 2022 (the “VASP Act”) does not currently regulate the primary issuance of tokens. The BVI was at the forefront of the ICO boom of 2017-2018, and remains at the forefront as innovative new use cases for tokens continue to evolve and emerge, as demonstrated most recently by the launch of a BVI tokenised fund, and the use of BVI vehicles for tokenising real world assets and for the issuance of stablecoins. The BVI’s well-established legal system and flexible business companies legislation, together with the regulatory clarity offered by the VASP Act, have played a critical role in positioning the BVI as the premier jurisdiction for token issuances.
Where the activities of a BVI company do fall within scope of the VASP Act, an application to be registered by the BVI Financial Services Commission (the “FSC”) as a VASP must be approved before the applicant is able to carry on its VASP related activities (unless the application was submitted on or before 31 July 2023, pursuant to the VASP Act’s grandfathering provisions). The FSC committed in its guidance to providing initial comments on a submitted VASP application within six weeks of submission and to concluding the application process within six months of submission. Whilst the first VASPs were only approved on 27 March 2024, a flurry of approvals have since followed, with more than 16 entities now registered to provide virtual asset services, to operate a virtual assets exchange and/or to provide virtual asset custody services. Carey Olsen were successful in assisting the virtual assets exchange, Keyex Limited, in becoming only the third VASP to be approved for registration by the FSC (Carey Olsen advises Keyex on application as a BVI VASP).
It is expected that VASP application review and approval timeframes will, shorten over time, so as to become more in line with the FSCs original guidance (although we shouldn’t be surprised to see updated guidance in due course which increases the estimated turnaround times slightly to allow the FSC reasonable time to conduct its in-depth due diligence, to consider applications in full and to engage with the applicants themselves). The fact that the FSC have acted with maturity over haste in reviewing the first applications under the BVI’s new regulatory regime is to be commended, as it indicates the jurisdiction’s commitment to protecting the BVIs global reputation as a leading financial services centre, and to prioritising compliance and integrity in this evolving, past-paced virtual assets space.
