It has taken its time but Jersey has finally announced a policy on virtual currency regulation.
Making the announcement at Jersey's first Fintech conference, Assistant Chief Minister, Senator Philip Ozouf said that the policy document was aimed at encouraging innovation.
"Virtual currency systems can be significant building blocks of a modern digital economy and the introduction of an appropriate and proportionate regulatory regime in this area is intended to encourage confidence and innovation in the sector."
The policy itself is something of a middle way as it steers clear of full regulation which may prove overly burdensome on a young industry and also may not ba able to adapt quickly enough as the technology develops.
However, it does create a framework within which virtual currency exchanges can operate, by putting exchanges within the legislation that currently governs the operation of money services business which enables young or small businesses with a turnover of less than 150,000 Euros to avoid having to gain an operating licence from the JFSC, Jersey' financial regulator, thereby making it easier to start companies but with the knowledge that growth will lead to greater regulation.
The policy consciously avoids seeking to legislate for distributed ledger technologies at the moment, stating that the sector is too young for regulation to have a meaningful effect. Instead, the policy document states that there will be a working group created which will continue to follow the technolgy's progress.
According to Senator Ozouf, the policy is designed to be a "a good starting point where Jersey can be the chosen location to both allow existing virtual currency business to innovate and grow whilst attracting new business to our shores."
There's no doubt that fans of virtual currencies based in Jersey will be delighted with the announcement. All that remains to be seen is how quickly Jersey can develop a virtual currency industry.
You can view the full policy document here.