As virtual assets continue to surge in global prominence, the regulatory landscape governing them becomes increasingly crucial. The jurisdiction in which virtual asset service providers (VASPs) choose to operate can significantly impact their prospects – either nurturing innovation or stifling growth.
In the first installment of our ‘Where to Relocate’ series, we turn the spotlight to Gibraltar as the first in a lineup of VASP-friendly jurisdictions.
Pioneering a VASP-friendly environment
Gibraltar has swiftly established itself as a leading hub for VASPs, finding the delicate balance between regulatory diligence and operational flexibility. Its journey towards becoming a haven for VASPs has been marked by proactive policies, robust regulations, and a competitive landscape.
The Gibraltar Financial Services Commission (GFSC) plays a pivotal role in safeguarding consumer interests, enhancing Gibraltar’s reputation as a quality financial services hub, and creating an environment conducive to business growth. The GFSC’s mission is to promote good business, protect consumers, and preserve Gibraltar’s good reputation as a financial centre.
The Distributed Ledger Technology Provider Regulations (DLTPR), in effect since January 2018, captured virtual asset-related businesses, making Gibraltar one of the first jurisdictions to do so. The DLTPR encompasses a broad scope of financially-based, DLT-related activities and sets out 10 Regulatory Principles that firms must adhere to.
These principles cover conduct, prudential, market integrity, and financial crime expectations and requirements. The principles-based, outcomes-focused approach ensures that regulation remains proportional to the scale and nature of the activities, preventing stifling overregulation.
Gibraltar’s commitment to international anti-money laundering (AML) and countering the financing of terrorism (CFT) standards enhances its reputation as a responsible financial jurisdiction. The government has implemented clear and transparent procedures, reducing bureaucratic complexities and facilitating business setup. The presence of skilled talent and government incentives, including tax benefits and grants, further bolsters Gibraltar’s appeal to VASPs.
Gibraltar’s journey as a crypto-friendly jurisdiction has extended to its fund industry, consistently ranking among the top 5 crypto fund domiciles in reports like PwC’s Annual Crypto Hedge Fund Report.
Experienced Investor Funds (EIFs) have gained popularity among crypto funds seeking the oversight of the GFSC while utilising a Protected Cell Company structure. The EIF route allows fund managers to build a track record cost-effectively.
Take an in-depth journey into Gibraltar with leading experts in the industry:
Gibraltar’s Minister for Digital and Financial Services, Albert Isola MP
In this article, Albert Isola discusses how Gibraltar has established itself as a global hub for distributed ledger technology (DLT) and cryptocurrency innovation through proactive policies, robust regulations, and a competitive landscape. He highlights Gibraltar’s strategic location, balanced regulation, rich expertise in the DLT sector, and commitment to excellence in regulatory processes.
Paul Astengo, Senior Executive at HM Government of Gibraltar
Paul Astengo, Senior Executive at HM Government of Gibraltar, discusses Gibraltar’s role as a global hub for Distributed Ledger Technology (DLT) and cryptocurrency innovation in this article. He highlights the contributions of Gibraltar Finance in promoting the financial services sector and fostering collaboration between the industry, public sector, and government.
The Gibraltar Financial Services Commission (GFSC)
In this article, William Gracia, head of DLT at Gibraltar Financial Services Commission (GFSC) underscores its crucial role in promoting good business, protecting consumers, and maintaining Gibraltar’s reputation as a quality financial services hub.
Gibraltar law firm ISOLAS
Jonathan Garcia, partner at ISOLAS, a full-service Gibraltar law firm, highlights Gibraltar’s rise as a leading hub for virtual asset service providers (VASPs) by striking a unique balance between regulatory diligence and operational flexibility.
Luke Walsh, a PwC Gibraltar advisory partner
Gibraltar’s innovative approach to crypto regulation, the growth of its fund industry and the appealing tax advantages makes it an attractive destination for crypto entities. Luke Walsh, a PwC Gibraltar advisory partner with over 14 years of experience, explores Gibraltar’s cryptocurrency regulatory landscape.
Robert Quinlivan, CEO of Bullish Gibraltar, highlights the exchange’s success as a top institutional digital assets exchange, emphasising its regulated and audited status under Gibraltar’s regulatory framework.