Vanuatu introduces new law to regulate virtual asset service providers
Date: 2025-04-01 Author: Oliver Abernathy Categories: IN WORLD
Licenses will be issued by the Vanuatu Financial Services Commission (VFSC), which will also monitor compliance with FATF standards and terrorist financing regulations. In the event of suspicious activity, the regulator has the right to investigate and impose fines of up to 250 million vatu (approximately $2 million) if violations are found. Violators can also face imprisonment for up to 30 years.
The adopted law does not apply to stablecoins, tokenized securities, and central bank digital currencies (CBDCs), despite their similarity to virtual assets.
The VFSC emphasized that the drafting of the law was the result of many years of analysis of the risks associated with digital assets. Vanuatu, as a small jurisdiction, attracts unscrupulous market participants who take advantage of the lack of clear regulatory standards or their insufficient development. The new law is aimed at improving public access to financial services and simplifying cross-border payments using cryptocurrencies. Vanuatu has already attracted the attention of the crypto community: the republic became the first country in the world to offer bitcoin as a means of payment for citizenship. In 2022, a British crypto investor acquired an uninhabited island in the archipelago, intending to create a “crypto utopia” there - a space for thousands of crypto owners with minimal regulation.
