Vanuatu Introduces Strict Crypto Regulations
Vanuatu has introduced legislation to regulate digital assets and set up a licensing framework for cryptocurrency companies looking to operate in the Pacific island nation. A government regulatory advisor described the law as “very strict.”
On March 26, the local parliament passed the Virtual Asset Service Providers Act, authorizing the Vanuatu Financial Services Commission (VFSC) to issue crypto licenses and enforce standards from the Financial Action Task Force, including anti-money laundering and anti-terrorism financing measures.
Under this law, the VFSC has broad investigative and enforcement powers, with penalties up to 250 million Vatu (approximately $2 million) and prison terms up to 30 years.
The legislation establishes a licensing and reporting framework for exchanges, NFT marketplaces, crypto custody providers, and initial coin offerings. Banks are also permitted to acquire licenses for offering crypto trading and custody services.
