The Bermuda Monetary Authority (BMA) has published a stakeholder letter summarising feedback to its November 2025 discussion paper on asset tokenisation and setting out its initial policy direction, ahead of a consultation paper due in April 2026. Respondents broadly supported a principles-based approach, requested clearer supervisory expectations and highlighted legislative gaps that could require amendments beyond the BMA’s remit. The BMA’s proposed approach regulates tokenisation as an activity rather than by asset class, relying primarily on the Digital Assets Business Act 2018 (DABA) and a functional, role-based perimeter covering issuers, intermediaries and custodians, with particular attention to governance, custody and customer asset protection, suitability and disclosures. To reduce dual-licensing friction, the BMA proposes clarifying regulatory taxonomy through a new definition of “tokenised investments”, reviewing the Investment Business Act 2003 (IBA) schedule to guide when a token may be an investment, harmonising investor qualification definitions across regimes, and introducing an integrated exemption framework to allow optional “mirrored” exemptions between DABA and IBA licensing in specified cases, alongside exemptions for fund administrators servicing tokenised funds and for investment funds with tokenised units from certain Digital Asset Issuance Act 2020 (DAIA) requirements. It also proposes extending the DAB AML/ATF Sector-Specific Guidance Notes to all regulated financial institutions engaging with tokenised assets, requiring custody arrangements to include bankruptcy remoteness, segregation, enhanced cyber controls, reconciliations, attestations and proof-of-reserve, and applying independent smart contract audit expectations and operational resilience and outsourcing requirements, while maintaining a technology-neutral stance on token standards. Next steps include the April 2026 consultation paper, after which the BMA will assess feedback, consider impacts on existing licensees engaged in tokenisation, and continue working with national stakeholders on legislative issues such as recognition of distributed ledger technology based registers and related company and fund law changes.
Bermuda Monetary Authority 2026-03-30
Bermuda Monetary Authority outlines activity based regulatory framework and licensing exemptions for asset tokenisation
The Bermuda Monetary Authority has issued a stakeholder letter on feedback to its November 2025 asset tokenisation discussion paper and initial policy direction ahead of an April 2026 consultation. It proposes an activity-based, technology-neutral framework under the Digital Assets Business Act 2018, with a functional, role-based perimeter, stronger custody, governance and disclosure standards, extended AML/ATF guidance, and independent smart contract audit and operational resilience requirements. The Authority will also clarify the regulatory taxonomy via a new “tokenised investments” definition, harmonise the Investment Business Act 2003 and Digital Asset Issuance Act 2020 through integrated exemptions, and work with national stakeholders on legislative changes, including recognising distributed ledger technology-based registers.