Catenaa, Thursday, March 13, 2025-The Cayman Islands will enforce new cryptocurrency licensing regulations starting April 2025. Virtual asset service providers (VASPs), including exchanges and custody services, must obtain licenses from the Cayman Islands Monetary Authority (CIMA).
The updated rules require VASPs to provide comprehensive details, such as the types and amounts of assets they hold, cybersecurity strategies, and risk management protocols. Trading platforms must also disclose their expected revenue and the physical location of their operational hardware.
The licensing process is part of the Cayman Islands’ broader efforts to regulate the crypto sector more effectively, expanding on previous anti-money laundering laws.
This move is expected to have a significant impact on the market, particularly on coins tied to the region such as HBAR, SUI, and ARB. The new regulations may increase transparency and attract institutional investors, boosting market confidence. However, the additional operational costs may push smaller companies out, resulting in market consolidation.
Cayman’s business-friendly climate has attracted several major crypto entities, including the Sui Foundation, Arbitrum Foundation, and Polygon Foundation. As more crypto companies establish a presence in the region, the new regulations are seen as a critical step toward establishing a more secure and regulated crypto ecosystem.
Currently, coins from the Cayman Islands, including SUI, ARB, and HBAR, have experienced declines in value, possibly in response to the new regulatory framework.
