U.S.-based cryptocurrency exchange Coinbase has received a license to operate in Bermuda and is reportedly set to launch a derivatives exchange there as soon as next week.
According to an April 19 blog post, Coinbase revealed that it had “obtained our regulatory license from the Bermuda Monetary Authority” the country’s financial watchdog. The license, a Class F license under the Digital Asset Business Act, allows Coinbase to conduct a range of activities, such as token sales and offerings. It also allows it to operate as a digital asset exchange and digital asset derivatives exchange provider
An April 19 report by Forbes, citing “a person close to the company,” said Coinbase plans to launch a derivatives exchange in Bermuda as early as next week. Coinbase cited clear regulations as the reason why Bermuda was “chosen as one of our financial centers,” explaining that its regulatory environment “has long been known for being highly rigorous, transparent, compliant, and cooperative.”
Some from the crypto community believe the latest development could be the beginning of the end for Coinbase US, as CEO Brian Armstrong revealed just a day earlier at a fintech event in London that the exchange May consider leaving US due to unclear regulation. Armstrong has been outspoken about his views on the state of U.S. cryptocurrency regulation, arguing in November that the SEC had failed to provide regulatory clarity and was driving investor and overseas trading activity.
Another obvious benefit of the Bermuda Exchange is its tax laws. Businesses operating in Bermuda are subject to payroll tax, but it has a 0% corporate tax rate, meaning profits are tax-free, making it an attractive base for companies looking to cut expenses. The latest development is an update to Coinbase's "broad and deep" campaign, which seeks to "establish a regulated entity and local operations" to foster international growth.
It also shed light on its progress in Brazil, Canada, Singapore, Europe and the United Arab Emirates, adding: “Our global approach will be consistent with our approach in the US: we will work with governments and regulators in different markets, and will always aim to be the most trusted and compliant cryptocurrency company in any market.”
