Regulatory Policy – Registration or Licensing of Virtual Asset Service Providers (May 2025)

Summary

This is a CIMA regulatory policy that sets out how the Cayman Islands Monetary Authority will assess applications from persons wishing to register, obtain a licence, or obtain a waiver to carry on virtual asset service (VASP) business under the Virtual Asset (Service Providers) Act (VASP Act) and its Regulations.

• Registration: Persons seeking registration under section 6, for virtual asset services that don't require a licence.
• Licence: Persons seeking a licence under section 8, for virtual asset custody services or operating a trading platform.
• Waiver: Supervised persons seeking a waiver under section 16.
• Excluded: The policy does not apply to sandbox licence applicants.

The policy explains CIMA's procedural and assessment framework: how applications are reviewed, the fit-and-proper criteria applied to beneficial owners, senior officers and directors, the documents required, and how conditions or preconditions attached to an approval must be satisfied. It also restates statutory obligations under the VASP Act itself, including the general prohibition on carrying on virtual asset service without registration, a licence, or a waiver, and the prohibition on unlicensed/unregistered entities implying they are CIMA-regulated.

The policy is largely explanatory/procedural rather than creating brand-new substantive rules, but it does impose specific timing obligations on applicants (such as disclosing changes to application information and meeting post-approval preconditions) and reiterates statutory consequences (including potential cease-and-desist action) for operating without proper authorisation. The policy took effect upon gazettement, stated in its title as 30 May 2025.

Key obligations

• Persons carrying on, or wishing to carry on, virtual asset service in or from within the Cayman Islands must be a registered person, hold a virtual asset service licence, or have been granted a waiver, as applicable under section 4 of the VASP Act.
• Applicants for a licence under section 8 must include all information prescribed and any additional information specified by the Authority.
• Registered Persons or Licensees must disclose any changes to information provided in their application to the Authority within 15 days of such changes (per sections 6(5) and 8(10) of the VASP Act).
• Where an approval is granted subject to requirements or preconditions, the Applicant must satisfy those requirements within the prescribed time or, if none is given, within 6 months of notification, or the approval decision becomes null and void.
• Applicants whose activity involves transfer of virtual assets must have systems and controls in place to comply with Part 10A of the Anti-Money Laundering Regulations and related VASP Act provisions, including maintaining originator/beneficiary information.
• Applicants whose activity does not involve transfer of virtual assets must demonstrate in their business plan an acceptable reason why Part 10A AMLR compliance is not required.
• Entities not licensed, registered, or granted a waiver under the VASP Act must not state, imply, or convey that they are regulated or authorized by CIMA to provide virtual asset service.
• Applicants must pay the prescribed application/licensing/registration fee as required under the Regulations.

Applies to

virtual asset service providers (VASPs), applicants for registration under section 6 of the VASP Act, applicants for a virtual asset service licence under section 8 of the VASP Act, supervised persons seeking a waiver under section 16 of the VASP Act, registered persons, licensees

Deadlines

• 15 days: Registered Persons/Licensees must notify the Authority of any changes to information provided in their application within this period (sections 6(5) and 8(10) of the VASP Act).
• 6 months from the date of notification (where no other timeframe is prescribed): Deadline for an Applicant to satisfy requirements or preconditions attached to an approval, after which the approval decision becomes null and void absent an extension.
• 30 May 2025: Effective date of the Policy, stated as effective upon gazettement.