Bermuda’s status as an early mover in digital-asset regulation is facing a fresh test as the United States signals a more welcoming stance toward the industry, raising questions over the island’s relative attractiveness to new ventures.
Since the Digital Asset Business Act (DABA) came into force in 2018, Bermuda has built a reputation as one of the first jurisdictions with a dedicated, comprehensive regime for digital-asset businesses, covering exchanges, custodians, token issuers and related services under a single framework.
By the end of 2024, 50 firms held active licences for digital assets and insurance innovation, a 60 per cent increase over the prior year. In the first quarter of 2025, that total rose to 53 licensed entities, including 39 digital-asset companies and 14 innovative insurers.
Bermuda is leveraging its longstanding strength in re/insurance to carve out a niche where digital assets and risk transfer intersect.
For example, Bermuda-regulated Members Capital has launched a tokenised insurance-linked securities fund on a digital-asset exchange, while also rolling out ILS funds that can accept stablecoins as investor capital.
And Bermudian-based Meanwhile, the first the first licensed long-term insurer to denominate premiums, policy values and claims entirely in bitcoin, announced in October that it had raised $82 million from major institutional investors, reflecting confidence in its business.
Such developments support Bermuda’s reputation as a centre of insurance innovation.
The Bermuda Monetary Authority has launched a discussion paper on asset tokenisation, seeking input from stakeholders on the opportunities, challenges and regulatory considerations of tokenisation, not only in insurance, but also in areas including investment funds, real estate, precious metals and environmental markets.
However, the global competitive landscape is shifting. In Washington, the tone toward digital assets has softened markedly in 2025. An executive order on “Strengthening American Leadership in Digital Financial Technology” directed US agencies to develop coherent frameworks for digital assets, tokenisation and real-time payments as part of a broader fintech strategy.
At the same time, the US Congress has advanced bipartisan legislation, including the Genius Act, aimed at providing federal-level clarity for core parts of the digital-asset market.
Commentators at the financial innovation firm WisdomTree have branded 2025 “the year clarity came to crypto”, arguing that US, UK and EU policymakers are converging on scalable rules after years of fragmented enforcement.
For the global industry, a more predictable US regime is likely to be net positive, increasing institutional comfort, deepening liquidity and accelerating mainstream adoption.
Until now, Bermuda’s clear, risk-based rules and direct access to regulators have been a differentiator, a key draw for overseas founders frustrated by uncertainty at home. If the US offers comparable clarity – alongside a larger domestic market, access to US banking rails and proximity to major venture capital hubs – some early-stage firms may opt to launch in the US, rather than a jurisdiction like Bermuda.
That does not necessarily spell decline for Bermuda. Instead, the island may sharpen its focus more narrowly and emerge as a domicile for sophisticated, cross-border structures rather than mass-market retail platforms.
Tokenised ILS, crypto reinsurance vehicles and life insurance products denominated in digital assets are all areas where Bermuda’s re/insurance expertise and digital-asset regime intersect in ways that are hard for competitors to replicate quickly.
In the near term, Bermuda’s challenge will be to keep building on the international credibility of its regulatory regime – particularly in areas such as tokenisation. If it can remain the jurisdiction where complex ideas in digital finance meet deep insurance capital and credible oversight, the island may find that America’s new openness is less a threat than a prompt to refine its niche.
