In a recent announcement, the Premier of Bermuda, David Burt, who is also Minister of Finance, made it clear that his intention is for a “new class of bank” to come to Bermuda, with legislation on the way to create new services to cater to Bermuda-based FinTech companies. This was due to the island’s fledgling FinTech sector facing “understandable resistance” from banks, as their business model “does not fit the mould of what we have come to know as Bermuda’s traditional model.”
During April 2018, the Government of Bermuda tabled the Companies and Limited Liability Company (Initial Coin Offering) Amendment Act 2018 (the “ICO Act”), introducing a statutory framework for initial coin offerings (“ICOs”). By implementing this new legislation, the Bermuda Government is hoping to lay the foundation for the jurisdiction to become a leading global blockchain and ICO centre. The ICO Act regulates offerings of ‘digital assets', which are meant to capture all of the various categories of digital coins and tokens (whether they be utility, securitized, equity or otherwise) being issued as ICOs and via token sales. The purpose of the ICO Act is to only regulate those ICOs and token sales which are public crowd funding or similar type projects. It is not intended to regulate either private sales or those which are engaged in the business of pure virtual currency issuances. Digital asset offerings will be conducted in accordance with the requirements of published regulations as well as ongoing supervision and compliance requirements, including AML/ATF.
March 2018 marks the 5th anniversary of the Bermuda Law Blog. Developed in 2013 as a way to communicate legal trends and topics relevant to Bermuda, including policy developments, cases, legislative changes and posts of general legal interest, it effectively scrapped the posting of ever-so-quickly dated "publications" documents delivered through the firm website as a link to a formal downloadable PDF. We were stepping outside the box in the hopes that visitors to our blog would find it more engaging, informative and useful. Although the road ahead was uncertain, the firm's directors gave the thumbs up for its development. They saw that blogging could offer a terrific opportunity to extend the value and scope of our legal experience to our clients and legal colleagues in areas of current interest through posts that are written in an accessible way. Andrew Martin put it really well when he said "Blog posts create a user friendly expression of ideas and information across the spectrum of work we do and give us an opportunity to demonstrate a high level of competence in our core areas of practice, as well as provide practical and informative guidance which we hope our clients and the wider legal community will find of interest.”
Here's to dynamic and forward-thinking leaders, I thought to myself.
“There is only one kind of shock worse than the totally unexpected: the unexpected for which one has refused to prepare.” Mary, Renault, The Charioteer
In May 2013, I wrote about the importance of addressing digital assets in the context of estate planning. With the passage of almost five years, I thought it would be interesting to revisit this subject. What, if any, progress has been made in identifying the nature and scope of digital assets and the rights arising in respect of those assets on the death of the “user”? To make this review a bit easier, I will adopt the definition of a “custodian” used in the Revised Uniform Fiduciary Access to Digital Assets Act (2015) (“DAA”) of the United States, who is defined as “a person that carries, maintains, processes, receives, or stores a digital asset of a user”. This definition is intended to cover all online accounts, services and social networking providers.