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There are as many challenges as there are opportunities facing
financial institutions, businesses, investors and start-ups
involved in the digital/virtual asset and cryptocurrency sectors.
Governments and regulators around the world are being tasked with
providing regulatory certainty and consumer protection against the
risks and turmoil commonly experienced by the sector yet struggle
to agree on a global approach to the use of the underlying
technology and how services and value arising from it should be
treated, regulated and taxed.
Some of the most progressive and comprehensive legal and
regulatory regimes aimed at providing certainty and a reduction in
the risk of fraud, money laundering and terrorist financing in the
sector have been developed offshore in the international financial
centres that have the sophistication and experience to understand
the risks and the ambition and agility to act quickly and keep up
with the legal impact of such technological advancements,
particularly in relation to defi, NFTs and DAOs.
Carey Olsen has been at the forefront of developments in the
digital/virtual asset and cryptocurrency sectors, advising on the
launch of the world’s first Bitcoin investment fund and the
first Ethereum denominated fund, as well as many of the most
pioneering initial coin offerings (ICOs) structured offshore. We
have been involved in the creation of sector specific legislation
and regulation in numerous jurisdictions where clients have
obtained licenses from or been registered with recognised
regulators to conduct digital/virtual asset business services. Our
commitment to assisting develop these laws and regulations and our
involvement in these transactions and applications across multiple
jurisdictions provides a unique insight into how some governments
and regulators are finding ways to provide security, certainty and
credibility in the sector whilst others are still struggling to
define the problem.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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