The introduction of the Virtual Asset (Service Providers) (Amendment) Bill, 2025 (the "VASP Amendment Act") amends the definition of what constitutes a "virtual asset issuance" and "issuance of virtual assets" to exempt entities which issue equity interests and are already, or will be, registered under the Mutual Funds Act (2025 Revision), Private Funds Act (2025 Revision), and Securities Investment Business Act (2020 Revision).
This essentially exempts "tokenized" funds from the requirement to register under the Virtual Asset (Service Providers) Act (2020 Revision) ("VASP Act") as a VASP entity.
Previously it was unclear whether tokenized funds required double registration under the VASP Act, as well as the Mutual Funds Act, but the VASP Amendment Act now makes it clear that tokenized funds are exempt from registration under the VASP Act.
This is a welcome change for fund managers, investment funds, investors and crypto funds and will expeditiously speed up the process for tokenized funds to be registered in the Cayman Islands.
Originally published 30 May 2025
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