For most of us 2017 was the year when we first heard the word
"blockchain". That year also saw the value of bitcoin
grow 1,300 percent and increasing interest in "digital
assets" such as cryptocurrency and initial coin offerings
(ICO) using blockchain technologies. The intervening period has
seen a steep learning curve for regulators, banks and insurers as
they seek to understand the new digital assets industry and the
risks that come with it.
Many digital asset start-ups view offshore financial centres
(OFCs) as natural domiciles for their nascent businesses: most of
these ventures have no attachment to any particular jurisdiction,
are inherently mobile, do not require large numbers of employees or
extensive office space and typically engage with investors and
counterparties from around the globe. Therefore, the tax neutrality
offered by OFCs is an obvious attraction, leaving investors and
digital asset holders subject to the taxation regimes in their
