Bermuda's digital asset regime: issuance, business licensing and tokenisation

Bermuda regulates digital assets through two separate Acts that are routinely confused with each other. Which one applies depends on whether you are offering a digital asset or providing a service in relation to one:

• Digital Asset Issuance Act 2020 (DAIA) — conducting a digital asset issuance in or from Bermuda: token sales, what used to be called initial coin offerings.
• Digital Asset Business Act 2018 (DABA) — carrying on digital asset business: exchanges, custodial wallets, payment services, trust services, lending, derivative exchanges.

Both are administered by the Bermuda Monetary Authority, and they overlap: DABA's own list of regulated activities includes issuing, selling and redeeming digital assets. The BMA has acknowledged the resulting dual-licensing risk and is consulting on cross-regime exemptions to address it — see the tokenisation section below.

This page maps the current regime instrument by instrument, and sets out where the BMA's asset tokenisation work has got to. Every status below was verified against Bermuda Laws Online on 1 August 2026; each instrument links to its own page here, which links to the regulator's own copy.

Digital asset issuance (DAIA 2020)

The DAIA replaced the earlier initial coin offering provisions in the Companies Act 1981 and the Limited Liability Company Act 2016. It received Royal Assent on 19 March 2020 and became operative on 6 May 2020.

Authorisation is required. A company, LLC or partnership may not conduct a digital asset issuance in or from Bermuda without the Authority's authorisation, granted against minimum criteria in Schedule 1.

The issuance document carries liability. An authorised undertaking must publish a digital asset issuance document, and both offence and civil liability provisions attach to misstatements in it.

The private placement exemptions have a filing trap. Offers to no more than 150 persons, to qualified acquirers, or to persons whose business involves dealing in digital assets can avoid public-offer treatment — but only if a digital asset placement declaration form is filed with the Authority before the transaction. The exemption is not self-executing, and the filing is prospective.

Ongoing duties include maintaining a local representative, reporting specified events and material changes, keeping acquirer assets in separate accounts, providing cooling-off rights and risk warnings, and notifying changes of control.

Fees (Schedule 2): an application fee of $2,266, plus authorisation fees tiered by offering size from $5,000 to $50,000 for direct offerings — and half those rates where the offering is made through an accredited digital asset business. Separate fees apply to exemptions, modifications, and variations of authorisation conditions.

The Authority can restrict, revoke or condition an authorisation, object to shareholder controllers, impose civil penalties, issue public censures and prohibition orders, and conduct investigations, with appeal to a tribunal.

What an issuer actually has to do — the DAIA Rules 2020

The Digital Asset Issuance Rules 2020 are where the operational detail lives. They took effect on 7 December 2020.

• Issuance document content — a long minimum-content list: issuer and group details, project description, technology and consensus mechanism, asset economics, offering terms, custody arrangements, risks, financing, soft cap and hard cap, the cooling-off and refund mechanism, and data protection controls.
• Ongoing disclosure — milestone progress updates at the disclosed frequency, notice of material changes before they take effect (or as soon as practicable where unforeseeable), and disclosure of any removal or replacement of service providers.
• Periodic returns — filed electronically, within the period and at the intervals specified in the issuer's own authorisation, covering organisational structure, directors and officers, revenue, transaction volumes, client profiles and outsourcing, with a signed declaration of accuracy.
• Market abuse — where the asset is or will be traded on a secondary market, systems to prevent, detect and report insider market abuse.
• IT and cyber — infrastructure meeting international best practice, including data audit node, cyber security report and cyber security programme requirements.
• Custody, AML/CFT, records — custody of acquirer assets, identity verification and enhanced due diligence, appointment of a Reporting Officer and a Compliance Officer, five-year record retention, and an internal compliance audit submitted with a certificate of compliance.
• Reduced rule sets apply to issuers relying on an accredited digital asset business, qualifying as a local issuer, or whose issuance is authorised or vetted by another competent authority — again, subject to filing an exemption form before proceeding.

Note that the reporting cadence is set in the authorisation itself, not in the Rules. There is no single filing date that applies to every issuer.

Digital asset business (DABA 2018)

DABA licenses the service layer. No person may carry on digital asset business in or from Bermuda without a licence, subject to exemption orders.

The regulated activities are broad: issuing, selling or redeeming digital assets; operating a digital asset exchange; payment services using digital assets; custodial wallet services; digital asset trust services; operating a derivative exchange; digital asset services vending; and digital asset lending and repurchase transaction services.

Core obligations run to client asset segregation, custody arrangements and transaction records; appointment of a senior representative with reporting duties; notification of material business changes and of new, increased or existing shareholder controllers; and audited accounts.

The instruments made under DABA

The Custody of Client Assets Rules 2025 apply where a licensee provides custodial wallet services under section 10(2)(d) of DABA. They require client assets — fiat and digital — to be held separately, set out what happens to pooled assets on the default of the licensee or an intermediary, and impose a monthly reconciliation to be completed within 10 days of the reconciliation date.

The exemption route

The Digital Asset Business Exemption Order 2023 (BR 66/2023), operative 23 June 2023, creates two exemption categories from the section 10 licensing prohibition.

Schedule I — automatic, no notification. The Authority, the Government of Bermuda and entities it owns, and public authorities.

Schedule II — notify and maintain. Affinity or rewards programmes with non-redeemable value; game publishers issuing in-game value usable only within their own games or platforms; providers of data storage or security services not otherwise conducting digital asset business for others; undertakings conducting digital asset activity solely for their own or a group undertaking's operations; and investment funds that have appointed a licensed or recognised investment manager.

Schedule II is not passive. A non-specified person must notify the Authority of its intention to rely on the exemption, and then file an annual declaration of continued eligibility, signed by a director, on or before 31 March each year.

Asset tokenisation: where the policy actually stands

This is the live area, and the short answer is that Bermuda is not building a new tokenisation regime — it is clarifying how the existing ones apply.

The sequence so far:

1. November 2025 — Discussion Paper on Asset Tokenisation. Exploratory, 80 consolidated questions, covering tokenisation of investments and funds, insurance products, real estate, precious metals, energy and environmental markets, DLT platforms, AML/CFT, conduct, cyber risk and financial stability. No rules proposed.
2. March 2026 — Stakeholder Letter summarising feedback. The BMA set out preliminary views: retain an activity-based, platform-centric approach under DABA; build an integrated exemption framework to avoid dual licensing across DABA, the Investment Business Act 2003, the Investment Funds Act 2006 and the Fund Administration Provider Business Act 2019; and harmonise “qualified participants” under the IFA with “qualified acquirers” under the DAIA. It also flagged that the existing Innovative Insurer classes (IIGB and IILT) are considered capable of accommodating tokenised insurance and reinsurance without a new licence class, with parametric products the focus.
3. April 2026 — Consultation Paper on Asset Tokenisation. The formal proposals.

The consultation paper's central proposal is a single harmonised “tokenised investment” definition, introduced through the Investment Business Act 2003 and cross-referenced in the IFA, FAPBA, DABA and DAIA — so that one definition governs across every regime an activity might touch. Alongside it: tailored cross-regime exemptions to avoid duplicative dual licensing, and entity-specific requirements covering due diligence and asset verification, token standards and technical implementation, risk management, outsourcing and vendor management, reconciliations, attestations and proof of reserve, and secondary market operations.

Throughout, the framework distinguishes digital twins — tokens representing an off-chain asset — from native tokens, which exist solely on distributed ledger technology. Requirements differ between the two.

The BMA and respondents also identified gaps needing legislative change rather than guidance: recognition of DLT-based share registers, clarity on token holder rights in insolvency, and the treatment of custody and control of tokenised collateral.

AML/CFT

Digital asset businesses are AML/ATF regulated financial institutions, so the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing) Regulations 2008 apply alongside the sector-specific requirements, together with the BMA's sector-specific guidance notes for digital asset business. The DAIA Rules carry their own due diligence, Reporting Officer and Compliance Officer requirements for issuers.

Recurring dates

The full set for every BMA-regulated sector is on the BMA compliance calendar.

A note on the Virtual Currency Business Act 2018

Searches for Bermuda's digital asset regime still surface the Virtual Currency Business Act 2018, along with Virtual Currency Rules, a code of practice and a statement of principles. None of these was ever law. They are the 2018 consultation package: the regime was circulated for consultation under the working title Virtual Currency Business Act 2018, and before passage its scope was widened from virtual currency to digital assets generally, so it was enacted as the Digital Asset Business Act 2018.

The draft instruments map one-to-one onto the enacted ones — the draft Virtual Currency (Client Disclosure) Rules 2018 became the Digital Asset Business (Client Disclosure) Rules 2018, and so on. They are indexed here as drafting history, not as a superseded regime. Nothing in them was ever in force; work from DABA.

Everything indexed, in one place

The full Bermuda digital asset set — including the statements of principles, guidance notes, information bulletins, public warnings and the complete consultation history back to 2018 — is on the Bermuda virtual assets topic page.

Every document page shows the instrument's current status, where that status came from, the date it was last checked, and a link to the regulator's own file.