Regulatory overview
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- Latest regulatory change
BermudaBermuda provides digital-asset business licensing under DABA and a separate issuance framework, DAIA, supervised by the BMA. Classes F, M and T distinguish authorisation models with individual activities and conditions. Custody has specific segregation and insolvency rules. The 2026 tokenization consultation proposes coordinating investment and digital-asset regimes, but does not establish that its proposed exemptions are already available.
A business issuing a tokenized investment from Bermuda must separate issuance from the accompanying services. DABA regulates digital asset businesses and DAIA certain issuances; a structure may also engage investment or fund rules according to the rights offered.
Licence class and tokenization do not themselves resolve that combination. BMA’s April 2026 consultation proposes coordination between regimes, but the project must work with current permissions and conditions while checking any final reform. The selection of issuer, platform and custodian depends on that map.
How DABA, DAIA and investment rules interact
The Digital Asset Business Act 2018, DABA, regulates digital-asset business in or from Bermuda. Its definition includes representations of debt, equity, other assets and rights. The perimeter covers business issuance, payments, trading, custody and other specified functions; the 2023 amendment added digital-asset lending and repurchase transactions among other changes.
The BMA distinguishes DAIA issuances from issuance conducted as a business. The Digital Asset Issuance Act 2020 addresses offerings within its perimeter, with separate requirements and exceptions. Incorporating a company, internally approving a whitepaper or holding another financial licence does not itself resolve the classification of issuance and associated services.
What BMA authorises and supervises
The Bermuda Monetary Authority, BMA, authorises and supervises in-scope businesses and issuances. Its regulated-entity register allows verification of the legal entity, class and permitted activities. A trading name does not replace that check, particularly where a group uses different entities for issuance, platform operation and custody. Permission must match the service the customer actually contracts for.
The BMA publishes digital-asset laws, codes and guidance. Supervision operates alongside anti-money-laundering and counter-terrorist-financing obligations. Bermuda licensing also does not confer a passport for acquiring customers abroad: distribution, advertising and cross-border services require checking destination-market restrictions and permissions.
What each licence class means for the project
Section 12 of DABA distinguishes Class F, Class M for a defined period and Class T for pilot or beta testing during an authorised term. Activities and conditions are specified individually. Class F does not automatically cover every possible function, and progression from T or M is not automatic. The authority may determine a different class from the one requested.
The BMA's 8 September 2025 notice describes applicant guidance as non-exhaustive guidance, not new legislation. Documentation is proportionate to class, nature, scale, complexity and risk. Applications must demonstrate governance, resources and controls appropriate to the activity; a commercial technology description does not replace evidence of operations and responsibilities.
How to connect the token with its asset and rights
The 9 April 2026 consultation recognises that tokenization may engage DABA, DAIA and investment, fund and fund-administration regimes simultaneously. It proposes a coordinated tokenized-investment definition and exemptions to reduce duplication. Harneys' June analysis likewise identifies proposed changes within existing frameworks, rather than an already operational new regime.
The draft distinguishes tokens linked to external assets from native distributed-ledger issuances. For the former, ownership, underlying-asset verification and reconciliation are essential. Every structure must determine the right transferred by its token and how it can be enforced. Fractionalising an investment neither removes investor-eligibility restrictions nor establishes automatic transfer of land ownership.
What custody requires and where its protections have limits
The 2025 custody rules apply to client assets held by licensed custodial-wallet providers. They require separation from proprietary assets, identifiable positions, reconciliation and annual control reviews. Pooling identical assets is permitted with written consent and conditions. Legal segregation therefore does not necessarily mean a separate wallet for every customer.
The rules also address beneficial ownership, intermediaries and distribution following specified insolvency or intervention events. Delegating custody does not release the provider from compliance. These mechanisms do not guarantee full recovery in every case: contracts, records, shortfalls and third-party holdings must be examined alongside the technical ability to reconstruct positions and return assets.
The BMA confirms publication of SCPS guidance in late 2024, covering single-currency stablecoin governance, risk, backing assets, attestations and disclosure. Its existence is distinguished from the initial consultation. Specific obligations depend on the issuer and permission; reserves, custody and redemption capacity must not be presented as a public guarantee of the token.
What to prepare before issuing and engaging infrastructure
Document what investors receive, who issues and which entities will trade or hold the token. Check individual permissions and the combined application of DABA, DAIA and fund or investment rules; a proposal to reduce duplication does not remove current authorisation requirements.
For external assets, prepare underlying-asset evidence and reconciliation with digital records. In custody, define consent, customer positions, third parties and procedures for shortfalls or insolvency. Technology should support reconstruction and return of positions under contracts and rules without turning segregation into a promise of full recovery.
To understand how this framework applies to your project, discuss your case with our team.
Key takeaways
- Class F does not authorise activities outside the individual permission.
- DABA regulates the business; issuance requires separate DAIA analysis.
- Custody combines segregation, records and insolvency distribution rules.
- Tokenization exemptions consulted on in 2026 are not presented as effective.
Regulatory milestones
DABA framework
The digital-asset business licensing framework is established.
DAIA issuance framework
In-scope issuances become subject to a specific BMA-supervised framework.
Client-asset custody rules
The BMA publishes rules addressing segregation, controls and insolvency events.
Tokenization consultation
Coordination and cross-regime exemptions are proposed; final implementation is not established.
Frequently asked questions
No. The class identifies the authorisation model, but activities and conditions depend on the individual BMA permission. The legal entity and scope must be checked, including custody, derivatives or lending where relevant.
The April consultation proposes coordination and cross-regime exemptions, but this review has not confirmed final adoption. Existing permissions must be analysed without inferring an exemption from the consultation document.
The custody rules permit pooling identical assets with written consent and specified conditions. Customer positions must remain identifiable and separate from the provider’s own assets.
No. Rule 10 maintains compliance duties when assets are passed to an intermediary. Contracts and controls must cover that custody chain.
Rule 3 requires an annual review by a qualified person and a report addressing controls, records and responsibilities. The initial application does not replace that monitoring.
