This Virtual Asset Service Providers Act 2024 came into force on 01 September 2024 in Seychelles and seeks to provide a legislative framework to regulate virtual asset service providers and address potential financial crime risks associated with the misuse of virtual asset products and virtual asset service provider services.

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The VASP Act 2024 mandates a licensing system for specific virtual asset products and services including wallet providers, exchanges, broking, and investment providers. This ensures that only authorized entities can operate as VASPs in or from Seychelles, providing a safeguard against unauthorised activities.

 

VIRTUAL ASSETS

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“Virtual Asset” means a digital representation of value that can be digitally traded or transferred and can be used for payment or investment purposes and does not include digital representation of fiat currencies, securities and other financial assets.

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TYPES OF VIRTUAL ASSET SERVICES

 

A. Virtual Asset Wallet Providers

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• Custodial Services

• Non-Custodial Services

 

Undertake the transfer of virtual assets, initial coin offering and non-fungible tokens for and on Behalf of clients, which may include individuals, institutional investors, or funds.

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Safekeeping of virtual assets, initial coin offering and nonfungible tokens or instruments enabling control over virtual asset, initial coin offering and non-fungible tokens for and on behalf of clients, which may include individuals, institutional investors, or funds

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Management of virtual assets, initial coin offering and non-fungible tokens or instruments enabling control over virtual asset, initial coin offering and non -fungible tokens for and on behalf of clients, which may include individuals, institutional investors, or funds.

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B. Virtual Asset Exchange

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• Transfer Services

• Conversion Services

• Exchange services

 

Undertake the exchange between virtual assets, initial coin offering and non-fungible tokens and fiat currencies for and on behalf of clients, which may include individuals, institutional investors, or funds.

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Undertake transfer of virtual assets, initial coin offering and non-fungible tokens for and on behalf of clients, which may include individuals, institutional investors, or funds. Undertake the exchange between one or more forms of virtual assets, initial coin offering and non-fungible tokens for and on behalf of clients, which may include individuals, institutional investors, or funds.

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Safekeeping of virtual assets, initial coin offering and nonfungible tokens or instruments enabling control over virtual asset, initial coin offering and non-fungible tokens for and on behalf of clients, which may include individuals, institutional investors, or funds.

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C. Virtual Asset Broking

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• Intermediary and facilitation services

 

Facilitate the exchange between virtual assets, initial coin offering and non-fungible tokens and fiat currencies through a virtual asset exchange and virtual asset wallet providers for and on behalf of clients, which may include individuals, institutional investors, or funds.

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Facilitate the exchange between one or more forms of virtual assets, initial coin offering and non-fungible tokens through a virtual asset exchange and virtual asset wallet providers for and on behalf of clients, which may include individuals, institutional investors, or funds.

 

D. Virtual Asset Investment Providers

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• Investment and funds management

• Advisory services.

 

Management portfolios of virtual assets, initial coin offering and non-fungible tokens for on behalf of clients, which may include individuals or institutional investors.

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Provision of investment advice on virtual asset, initial coin offering and nonfungible tokens for and on behalf of clients, which may include individuals or institutional investors.

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SUBSTANCE REQUIREMENTS

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Every licensee shall

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• have at least one resident person as director on its board of directors;

• operate a fully manned office in Seychelles;

• employ qualified or experienced staff to manage the office;

• ensure that all records and documentation required to be kept by the licensee are available and accessible from the office;

• undertake complaint handling in Seychelles;

• annually, hold at least 2 meetings of its board of directors in Seychelles;

• annually, hold at least 4 management meetings in Seychelles.

 

TAXATION

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A licensed VASP can benefit from a tax rate of 1.5% applicable on the assessable (gross) and zero withholding tax rate on dividends or interest payable.

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PROMOTION OF INITIAL COIN OFFERINGS AND NON-FUNGIBLE TOKENS

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All persons intending to issue or purport to issue an initial coin offering or a non-fungible token, or hold himself, herself or itself out as carrying on that activity, in or from the Seychelles must be registered with the FSA. A natural person shall not be eligible to promote an initial coin offering or the sale of or investment in the development of non-fungible tokens in or from the Seychelles.

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“Initial Coin Offering” means a method of raising funds whereby an issuer is issuing virtual assets and is offering them in exchange for funds.

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“Non-Fungible Token” means a unique digital identifier that is recorded on a blockchain and is used to certify ownership and authenticity.

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