Digital Asset Business Act (DABA)

Scope

DABA applies to digital asset business carried on in or from within Bermuda. Covered activities include issuing, selling, or redeeming digital assets; operating as a payment service provider using digital assets; operating an exchange; providing custodial wallet services; and providing market-making or other digital asset services. A business conducting those activities must be licensed by the Bermuda Monetary Authority and is subject to its supervision, including requirements on governance, client asset protection, cybersecurity, and anti-money-laundering controls.

License Classes

The Act provides for license classes that differ in scope and conditions. A Class M license is a modified license granted for a defined period with restrictions set by the Authority, designed for businesses whose activities the Authority supervises under tailored conditions. A Class F license is a full license without that time limitation. The Authority publishes the register of licensed undertakings and public warnings about entities falsely claiming affiliation with licensed ones.

Why It Matters to Counterparties

A DABA license identifies the Bermuda entity, the activities it is licensed for, and the supervisory framework it operates under, all of which an institution can verify with the Authority as part of due diligence.