Is crypto legal in Cayman Islands? Regulation & rules (2026)

CIMA published a Market Conduct Rule and SOG (MC-RSOG) for all authorized VASPs—covering conflict management, disclosures and fair treatment of clients—and updated the December 2024 Custody/Trading Platform Rule & SOG. It signals a shift from pure AML registration toward conduct-of-business supervision.

CIMA reported results of a desk-based review (Sep 2024–Feb 2025) of 11 VASPs, flagging significant gaps in corporate governance, cybersecurity and asset custody and urging stronger internal controls. The review set supervisory expectations for the newly licensed sector.

Amendments to the VASP Act required virtual asset custodians and trading platform operators to obtain a full CIMA licence (registration no longer sufficient), with enhanced prudential rules and a minimum of three directors including one independent. Existing registrants had to apply by 29 June 2025.

CIMA published the consolidated 2024 Revision of the VASP Act, incorporating prior amendments into a single instrument and forming the legislative base for the Phase Two licensing reforms.

After completing its 63-action plan and an on-site visit, FATF removed the Cayman Islands from its list of jurisdictions under increased monitoring. The exit restored confidence in the AML/CFT framework underpinning the VASP regime.

FATF placed the Cayman Islands under increased monitoring for strategic AML/CFT deficiencies, including sanctions, beneficial ownership and prosecution gaps. The listing intensified pressure to fully implement and enforce the new VASP framework.

The Cayman Islands legislature passed its foundational virtual assets statute, published in the Legislation Gazette, creating a framework to register and license virtual asset service providers in line with FATF standards. It is the cornerstone of the jurisdiction's crypto regime.