Asset managers continue to launch new vehicles devoted to digital assets and blockchain solutions, with more and more funds set up as crypto native funds.

The impact of the bankruptcies of the crypto brokers at the end of Q4 highlights the importance for robust governance and controls. Given Bermuda's market position in the digital asset space, its longstanding funds history, its comprehensive regulatory framework and the reputation of the Bermuda Monetary Authority as an internationally well-respected regulator, we expect Bermuda to be a very attractive jurisdiction for fund formation in this space.

In addition, we are seeing solutions to tokenisation of regulated fund vehicles to continue to evolve, particularly as we are seeing an increasing number of digital assets exchanges, market makers and service providers looking to Bermuda. The number of fund administrators seeking to be licensed under the Digital Asset Business Act suggests that this trend will continue in 2023 and beyond. Insurance linked securities ("ILS") funds and the establishment of new ILS managers also continue to thrive in Bermuda. Finally, we expect to see an increase in the registration of fund managers incorporated in Bermuda, following changes made to the Investment Business Act in 2022.

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