(3 minutes read)
Seychelles will regulate the activities of Virtual Asset Service Providers (VASPs) registered in the island nation. The aim is to ensure meeting the standards of the Financial Action Task Force (FATF). For the uninitiated, VASPs are businesses that facilitate the exchange of virtual assets, which include cryptocurrencies like Bitcoin, non-fungible tokens, or utility tokens like Filecoin.
As part of the process, a national risk assessment on virtual assets and their service providers was conducted by Danny Sanhye of BDS Forensics. The finding was presented to local partners in the private sector recently.  Present among the participants were representatives of the banking sector, corporate service providers, the insurance sector, the securities sector, lawyers and accountants, and auditors.
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There is a large number of VASPs operating in Seychelles. Because of the lack of infrastructure, their operations are not properly monitored. Authorities are trying to put in place a system that can monitor the complex operations and adequate forensic checks. Seychelles does not have a licensing regime for VASPs. This is not in accordance with recommendation 15 of the Financial Action Task Force (FATF) Standards. Already some of these VASPs are under investigation. Without the proper regulation in place, Seychelles is currently deemed as being ‘non-compliant’ in the Mutual Evaluation Report published in 2018 and its subsequent follow-up report of the Eastern and Southern Africa Anti-Money Laundering Group.
