Isle of Man’s Labour Party Gets Squeamish Over the Whole ‘Digital Cash’ Thing

Manx news outlet The Isle of Man Today reported Thursday that the Manx Labour Party has called for the island’s Department of Economic Development to conduct a risk assessment of cryptocurrencies, which apparently are giving Labour a cause for concern.

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Isle of Man’s Labour Party Gets Squeamish Over the Whole ‘Digital Cash’ Thing

Manx news outlet The Isle of Man Today reported Thursday that the Manx Labour Party has called for the island’s Department of Economic Development to conduct a risk assessment of cryptocurrencies, which apparently are giving Labour a cause for concern.

Bitcoin, the party said, is “the payment of choice on the Dark Web,” according to the story.

Here is the full text of the statement from Manx Labor press officer David Carter:

“The government must give serious consideration to the evolving international regulatory environment.

“The island has an ambition to lead the way.

“However, there is a risk that a small jurisdiction such as ours will in the future conflict with the UK, EU and especially USA where at present a public review is under way of a proposal to impose stricter regulations on cryptocurrency businesses.

“The Manx Labour Party believes that the government should take a more balanced approach to the regulation of this emerging sector.

“This more balanced approach must include substantial oversight of all cryptocurrency businesses operating on the island.

“The government must take material steps that target possible criminal, financial and political risks, without undermining the activities of entrepreneurs who wish to develop legitimate businesses that utilise this new and potentially valuable technology.”

A Timeline of Bitcoin Events on the Isle of Man

Curiously enough, the Isle of Man has been very vocal so far in its quest to keep its local Bitcoin business as white hat as possible.

“Our stance is intended to welcome those who can meet the necessary standards while also preserving the island’s good reputation as a financial centre,” the Department of Economic Development’s Peter Greenhill said in June, when the Manx government announced it was working out how to make room for cryptocurrencies in its legal framework.

In July, the island announced it would be hosting its Crypto Valley Summit. "The Isle of Man is 'digital currency friendly,'” summit co-organizer Eric Benz said in July. Benz also added: 

“There is strong government support for quality companies moving here, and the Crypto Valley Summit will be the first of many specialized events to take place. The island has quickly become a leading player in the competition for the development and investment of crypto businesses whilst providing an environment for them to operate and showcase their technology to the world."

Infographics Isle of Man

Shortly thereafter, the Manx government issued updated guidance as to how cryptocurrencies would fit into the country’s existing laws:

“Certain activities relating to virtual currencies should be brought within the Anti-Money Laundering/Countering the Financing of Terrorism (‘AML/CFT’) framework,” CoinTelegraph reported from a government statement issued in late July.

“This includes amending Schedule 4 to the Proceeds of Crime Act 2008, applying that law to the ‘virtual currencies market,’ and drafting a new bill called the Designated Businesses (Registration and Oversight) Bill that will allow the Manx Financial Supervision Commission to oversee ‘how virtual currency and other designated businesses comply with the Island’s AML/CFT legislation.’"

In September banks began to cut ties to Bitcoin businesses on the island, CoinTelegraph reported.

"It was just a few months ago that the Isle of Man announced their plans to become a haven for Bitcoin and other cryptocurrencies," CoinTelegraph's Carlo Caraluzzo reported. "There is little doubt that the Island’s government hoped to establish them in the cryptocurrency sector in much the same way as countries with lax banking laws in the Caribbean had captured so much of the financial sector. This plan seems to have hit a major roadblock however after Capital Treasury Services, part of the Capital International Group’s financial empire, announced that as of next month they would no longer be doing business with digital currency businesses."

A day after the announcement from CTS, the Crypto Valley Summit began, bringing together more than 170 C-suite and senior executives from around the world to talk business in the cryptocurrency space.

CTS said it would process the last payments for Manx Bitcoin companies on October 15.

“Britain is making claims about its commitment to innovation, not least in the area of FinTech, and yet, regrettably, the banking industry does not seem to share this commitment,” Simon Hamblin, the CEO of Manx bitcoin, gold and GBP exchange Netagio said in a September press statement.

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