The Bermuda Monetary Authority has released a consultative paper that proposes to subject crypto-currencies to anti-money-laundering regulation, the better to attract Bitcoin exchanges, initial coin offerings and other virtual business to the island. The paper makes it evident that the Government does not believe that it can attract such business without a strong dose of regulation.

The objective of the paper is to provide an outline for the effective regulation of service providers in the virtual currency business industry (virtual currency business service providers or (VCBs)) in Bermuda. For the purposes of the paper, virtual currency is used as defined by the Financial Action Task Force (the world's anti-money-laundering standard setter) in its report on virtual currencies of June 2014. This portrays virtual currency as a digital representation of value that can be digitally traded and functions as a medium of exchange and/or a unit of account and/or a store of value, but is not legal tender status (i.e. not a valid and legal offer of payment when tendered to a creditor) in any jurisdiction. It is not issued or guaranteed by any jurisdiction and fulfils its functions only by agreement among users.