The U.S. Virgin Islands Cryptocurrency Regulations
The U.S. Virgin Islands Cryptocurrency Laws Regulation of Digital Currencies: Cryptocurrency, Bitcoins, Blockchain Technology
The U.S. Virgin Islands are an unincorporated territory of the United States. [1]
In 2014, the Conference of State Bank Supervisors (CSBS), the nationwide organization of banking regulators for the 50 states plus the District of Columbia, Guam, Puerto Rico, and the U.S. Virgin Islands, issued a draft model state regulatory framework for virtual currencies. The CSBS formed an Emerging Payments Task Force to evaluate payments developments and innovations, and to examine the intersection between emerging payments and its member’s roles as state financial regulators. [2]
As a result, CSBS developed its draft model regulatory framework which includes licensing, consumer protection, market stability, anti-money laundering, and cybersecurity requirements for state-licensed virtual currency firms. CSBS has considerable influence on individual states’ banking laws, however, it doesn’t have direct involvement in their laws. Its draft framework states:
“In the case of virtual currencies, licensing and supervision requirements should apply to entities engaged in the following virtual currency activities on behalf of another:
Transmission.
Exchanging:
Sovereign currency for virtual currency or virtual currency for sovereign currency.
Virtual currency for virtual currency.
Services that facilitate the third-party exchange, storage and/ or transmission of virtual currency (e.g. wallets, vaults, kiosks, merchant-acquirers, and payment processors).” [3]
However, United States Virgin Islands has not enacted regulations or legislation specifically regulating digital currency yet. According to Cointobuy’s analysis, the crypto-related activity in this country has a 2.8/10 safety rank. Also, Cointobuy has ranked United States Virgin Islands in the position 107 out of 249 countries in terms of cryptocurrency safety. [5]
P.S. Insights on Cryptocurrency Legal Issues
Most jurisdictions and authorities have yet to enact laws governing cryptocurrencies, meaning that, for most countries, the legality of crypto mining remains unclear.
Under the Financial Crimes Enforcement Network (FinCEN), crypto miners are considered money transmitters, so they may be subject to the laws that govern that activity. In Israel, for instance, crypto mining is treated as a business and is subject to corporate income tax. In India and elsewhere, regulatory uncertainty persists, although Canada and the United States are relatively friendly to crypto mining.
However, apart from jurisdictions that have specifically banned cryptocurrency-related activities, very few countries prohibit crypto mining.
Our Freeman Law Cryptocurrency Law Resource page provides a summary of the legal status of cryptocurrency for each country across the globe with statutory or regulatory provisions governing cryptocurrency. The globe below provides links to country-by-country summaries:
