Utilizing A Corporate Entity For Cryptocurrency In The BVI

  • Post category:BVI

The British Virgin Islands (BVI) are renowned for being one of the biggest offshore jurisdictions in the world. The nation has made significant efforts to position itself as a desirable location for international business travelers, particularly those looking to start, host, and expand crypto-related ventures.

How To Utilize A Business Company For Cryptocurrency in BVI



The government has not yet released any frameworks for virtual assets, blockchain, or financial technology in general, nor does it currently have any special regulatory advice or guidance for cryptocurrencies.

Although no draft legislation or consultations have been issued, the jurisdiction has stated its openness to create a supporting legal structure specifically geared for cryptocurrencies.


The BVI Financial Services Commission (FSC) confirmed on July 10, 2020, that the laws governing crypto-related operations will be based on the current financial services legislation.

In order to ensure compliance, firms with activities like running a cryptocurrency exchange or doing crypto financing would need to carefully assess if their proposed operations will be covered by the laws in place. A few examples include:

  • Securities and Investment Business Act 2010 (SIBA) – An Act to Establish Investment Business Licensing, Regulation, and Supervision for Related Purposes. The BVI Financial Services Commission has confirmed that where a virtual asset product or service delivers a benefit or right beyond a medium of exchange, it may be captured under the SIBA.
  • Anti-Money Laundering Regulations 2008 (MLR), as amended from time to time – By implementing customer due diligence procedures, these policies seek to prevent and identify money laundering and terrorist financing in the BVI. Whether or not they are subject to this law, businesses should nevertheless consider following the anti-money laundering framework as a matter of good corporate governance.
  • Banks and Trust Companies Act 1990 (BTCA) as amended – The Act would also apply to cryptocurrency companies whose operations fall under the jurisdiction of banking activity since it specifies the prudential criteria for banks and trust organizations.
  • The Financial Services Commission Act, 2001 (FSCA) – According to this law, the FSC has extensive oversight authority over all financial services provided within or from the BVI.
  • The Financing and Money Services Act, 2009 (FMSA) as amended – It is possible to consider a cryptocurrency transaction to be the provider of money services when it is used to enable currency exchange services, in which case FMSA would apply.


Several businesspeople have been drawn into this industry by the widespread use of cryptocurrencies and the rise in their number as investments and forms of payment.

According to a recent report, the global blockchain market will be valued at more than US$60 billion in 2025, growing at a rate of 69.4% annually.

Like any business, the applicant should eventually think about incorporating their cryptocurrency-related activities.

A BVI Business Corporation is one of the most popular legal structures the applicant can select if they are interested in starting cryptocurrency-based businesses (BC).

The BVI Business Companies Act 2004 (BCA) defines a business company as an entity that offers flexibility, a comparatively free flow of cash, and cheap establishment expenses. The applicant may utilize a BC to conduct the cryptocurrency-based business as long as the cryptocurrency is not used for illicit purposes.

A BC will be required to get licenses to operate cryptocurrency projects in accordance with the laws issued by the FSC, even if there isn’t any properly developed legislation on crypto licensing for BVI corporations.



The following requirements must be met in order to incorporate a BC in the BVI:

  • Have at least one director and one shareholder who can be the same person and does not need to reside in the BVI
  • It is necessary to have a registered office or registered agent office address (a P.O. box address is not sufficient)
  • Need a business name that is distinct from or unrelated to one that already exists.


Step 1: Appointing a registered agent and registering the business name

All BVI corporations are required to nominate a registered and licensed agent, who must be a resident and have a current FSC license. The agent will be responsible for maintaining the company’s statutory records and filing annual returns.

The following prerequisites must be satisfied before a name can be registered for a BC:

  • The name must be distinctive (i.e., different from already-used company names);
  • It must not contain offensive language or violate the rights of any other business
  • Without the approval of the BVI Registrar of Companies, it may not imply a relationship with the financial services industry, the government, or both, or use any other wording that is prohibited by the Commission.
  • The name must be licensed under specific enactment (e.g., insurance company)

It should be noted that the BVI BC may lawfully be designated as using either the full or abbreviated form.

Step 2: Incorporating the company

The applicant must deliver the following paperwork to the BVI Registrar of Companies in order to incorporate:

  • Filled-out application form
  • Memorandum and Articles of Association of the Company
  • The approved document that the potential registered agent signs, indicating their agreement to serve as a registered agent
  • The incorporation fee

The application for company registration may only be submitted by the chosen registered agent; the Registrar will not accept applications from any other applicants.

The Registrar will assess the application in about 2-3 days. The applicant will receive a certificate of incorporation once your business has been registered in the BVI, serving as proof of this fact.

Step 3: Obtaining a business license

You must obtain a cryptocurrency license in order to launch your cryptocurrency business in the British Virgin Islands after your company has been registered.

You must assess if a license applies to your business by taking into account the following factors:

  • How to use a cryptocurrency asset
  • the kinds of activities being suggested or performed.
  • The degree to which the business’s operations match those of a typical enterprise; and
  • The features and commercial activity (economic substance) connected with an offering or issue.

When the applicant establishes that the business engages in a regulated activity, they must submit an application for a license to the FSC. Application forms, business plans, and application costs must all be submitted as part of the application process (depending on whether the license is standard or non-standard).

Step 4: Complying with post-registration requirements

The minimum and easiest to adhere to compliance standards for a BC.

  • Annual general meetings are not necessary.
  • Create a company bank account to uphold fiscal openness (e.g., an offshore brokerage account)
  • There are no financial statements, annual return filings, or yearly audits other than the annual renewal.
  • Corporate books, minutes of meetings, and resolutions of members/directors can be held at any place.


A BVI company that participates in the Sandbox must have at least two individual directors (as opposed to corporate directors) or, in the case of a limited partnership, two individual partners. Additionally, the number of clients a BVI company may have is limited to those that were accepted by the FSC during the application process. They must also take adequate measures to identify potential risks relating to their business and to take measures to address those risks (including prevention of money laundering and terrorist financing).

The participant is required to notify the FSC right away of any development or change in the way its business is conducted or in the environment in which it operates that could have an impact on its risk profile or its duties under the Regulations.

The FSC may require participants in the sandbox to provide interim reports at intervals it deems appropriate, along with suitable records, to the FSC. The CEO must affix his or her signature to these reports (or equivalent).

When approaching potential clients, a participant must inform them that they are not FSC-licensed, as well as the risks of taking part in the sandbox, the fact that the activities are being carried out in accordance with the participant’s business proposal, and how long the FSC has given the participant permission to operate within the sandbox.


Billion-dollar amounts have been raised in recent years through initial coin offers (ICOs) for cryptocurrencies, tokens, and other blockchain-based assets. Major offshore financial centers like the British Virgin Islands (BVI) have aimed to participate significantly in this new phenomenon of capital raising, and there is a growing demand for using BVI firms as ICO issuer vehicles.

While other offshore jurisdictions have experienced similar interest, establishing an ICO through a BVI corporation offers a number of advantages that have made the BVI an ideal ICO base. The result is that over the past 12 months, the jurisdiction has witnessed a number of extremely successful launches.


ICOs are really just another way to acquire outside funds.

In contrast to a traditional IPO, when investors receive a security whose return is based on the success of the issuer or its group’s business, in an ICO, investors trade cash for a brand-new cryptocurrency on a blockchain network.

This digital asset typically takes the form of a credit or token that can be used to make purchases within the platform or business where the ICO funds will be put to use.

However, instead of using these “utility tokens” to make purchases within the application, the majority of investors will hold the tokens in the expectation that the underlying enterprise’s success (in which the new utility token will be the only or primary unit of exchange) will result in an increase in the relative cash value of the utility token as demand for those tokens to be used within the application and their potential acceptance as wider means of exchange increase.

Most utility tokens are not considered “investments” or “securities” by regulators and are not, therefore subject to many of the regulations and restrictions that might apply to a public debt or equity issued by a company because the value of a token is determined by the demand for the token itself rather than returns or repayments from some underlying business operated by the issuer. Thus, ICOs provide a quick and affordable way for startup or early-stage businesses or technology entrepreneurs who might not otherwise have access to capital markets to obtain large amounts of funds.


While it is widely agreed that an ICO in its typical form would not be restricted or subject to more onerous regulation under the current BVI financial services legislation, it is still crucial and necessary to take such legislation and the Guidance into consideration when considering any proposed ICO in order to make sure it is properly structured and to avoid tripping any restrictions or obstacles that would not otherwise apply.

The following are provisions of the BVI financial services legislation to be taken into account with regard to an ICO:

  • Securities and Investment Business Act 2010 (SIBA)
  • BVI AML Law
  • The Financing and Money Services Act 2009 (FMSA)
  • Beneficial Ownership Secure Search System Act 2017 (the BOSS Act)
  • Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard (CRS)


SIBA regulates the operation of investment exchanges, but only to the extent that the items exchanged on those exchanges would be considered “investments” under SIBA. Therefore, running an exchange of such tokens would not be regarded as a regulated activity when a token is thought to be a utility token (and is thus exempt from the regulatory reach of the legislation discussed above), provided that nothing that would be considered an “investment” is used as a medium of exchange for such utility tokens.

Hence, exchanging utility tokens for other utility tokens, fiat money, or some stable coins would not be considered a controlled activity. Trading utility tokens for a token that resembles an investment, on the other hand, would probably be subject to regulation.


It should be noted that the BVI recently established the Financial Services (Regulatory Sandbox) Rules, 2020, to deal with scenarios where a token would likely be regulated (whether under SIBA, FMSA, or other laws) or where an exchange would likely entail the trading of “investments” (the Regulations).

The Rules offer a “regulatory sandbox” in which cutting-edge fintech businesses may operate, provided that they do so in accordance with a well-outlined business strategy and with a constrained (and predetermined) number of clients. Accordingly, it may be able to “sandbox” an activity even in the unlikely event that a token is thought to fall within financial regulation, delaying full compliance with BVI financial services regulation while the technology is being evaluated.


In general, if a virtual asset or a product related to virtual assets is considered an “investment” under the Securities and Investment Business Act (“SIBA”), the BVI business may need to get a license to engage in certain activities relating to that investment.

Under SIBA, “investments” include:

  • Shares, etc.: shares, interests in a partnership or fund interests;
  • Debentures, etc.: debentures, debenture stock, loan stock, bonds, certificates of deposit, and any other instruments creating or acknowledging indebtedness other than for money borrowed to defray consideration for the supply of goods or services and also does not include a cheque or other bill of exchange, a bankers draft or a letter of credit;
  • Instruments giving entitlement to shares, debentures: these include warrants or other instruments entitling the holder to subscribe for investments;
  • Certificates representing investments: certificates which confer contractual or property rights held by a person other than the person on whom the rights are conferred by the certificate or instrument and the transfer of which may be set up without the consent of that person;
  • Options: options to acquire or dispose of an investment, including any currency, palladium, platinum, gold or silver;
  • Futures: a futures contract other than a contract made for commercial and not investment purposes. A contract shall be regarded as made for investment purposes if it is made or traded on an investment exchange or made otherwise than on such an exchange but expressed to be as traded on such an exchange or on the same terms as those on which an equivalent contract would be made on such an exchange for commercial and not investment purposes;
  • Contracts for differences: rights under a contract for differences or any other contract, the purpose or intended purpose of which is to secure a profit or avoid a loss by reference to fluctuations in property or an index other than a contract that involves taking delivery of any property to which the contract relates;
  • Long-term insurance contracts: long-term insurance contracts or rights and interests in any investments;
  • Rights and interest in investments: rights to and interests in any investment; and
  • Specified investments: anything specified as an investment from time to time by the relevant regulations.

Importantly, investments under SIBA do not include cash or real estate.

A virtual asset transaction that is a “contract for differences,” for instance, would be considered a “investment” under SIBA based on the aforementioned.

The following activities fall under the definition of investment business under SIBA:

  • Dealing in investments;
  • Arranging deals in investments;
  • Managing investments;
  • Providing investment advice;
  • Providing custodial services with respect to investments;
  • Providing administrative services with respect to investments; and
  • Operating an investment exchange

Reach out to us at Relin Consultants – Leading Global Business Set Up Partners for more information.


Do I need to visit the British Virgin Islands in order to start my crypto licensed business?

No. All the procedure of registration, operation and reporting to the authorities can be completed 100% remotely.

Is there any need for AML/KYC policies?

Yes, Anti-Money Laundering (AML) and Know Your Customer (KYC) policies are mandatory for crypto businesses in the British Virgin Islands.

Can you assist me in finding good business partners to fulfill the personnel requirements in BVI?

Yes. Hiring knowledgeable and driven business partners in the BVI is essential for a project’s success. You can get help from Relin Consultants in selecting the top candidates for your team.

Can you help me design the business plan of my crypto company in BVI?

Yes! We can create a business plan for any type of venture. We have dealt with the licensing authorities before, and we are aware of their demands of applicants.

Can I open a bank account for my crypto business in the BVI?

Very unlikely. Projects in the BVI are best suited for company strategies that don’t use fiat currencies at all.