Centralized exchange in Belize

The primary regulator for financial services in Belize, including licensing and oversight of investment businesses, securities dealing, and collective investment schemes, is now the Financial Services Commission (FSC), which replaced the International Financial Services Commission (IFSC).

Belize's Virtual Assets Services Act, 2024 remains in force, but its security, operational resilience, and risk management sections are now supplemented and partially superseded by the Digital Asset Services Licensing Regulations, 2025, which imposes a new licensing framework that overrides earlier provisions.

Evidence fact bz.custody.digital-asset-services-licensing-regulations-2025 not found (may have been renamed).

Application Process: Submission of a detailed application to the Financial Services Commission (FSC), formerly the IFSC.

Fit and Proper Test: Directors, senior management, and significant shareholders must undergo a "fit and proper" assessment, considering their competence, integrity, and financial soundness.

Minimum Capital Requirements: VASPs must meet prescribed minimum paid-up capital requirements, which are stipulated in the Regulations and vary depending on the services offered.

Business Plan: Submission of a comprehensive business plan detailing operations, organizational structure, internal controls, risk management framework, technology infrastructure, and security measures.

AML/CFT Compliance: Robust Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) policies and procedures must be in place, compliant with Belizean laws (e.g., Money Laundering and Terrorism (Prevention) Act) and international FATF standards. This includes customer due diligence (CDD), record-keeping, suspicious transaction reporting, and internal controls.

Separate Accounts: A licensed VASP providing custody services must hold client virtual assets in accounts separate from its own assets.

No Commingling: Client assets must not be commingled with the VASP's proprietary assets.

Trustee Capacity: The VASP must hold client virtual assets in trust or a similar fiduciary capacity, ensuring they are protected in the event of the VASP's insolvency or bankruptcy.

Record-Keeping: Detailed and accurate records of all client virtual assets must be maintained, clearly identifying ownership.

Financial Resources: VASPs are expected to maintain adequate financial resources, including sufficient capital, to cover operational risks and potential liabilities.

IFSC Discretion: The IFSC may, at its discretion, impose specific insurance or bonding requirements on individual licensees based on their business model, scale of operations, and risk profile.

Financial Intelligence Unit (FIU) of Belize

Virtual Asset Services Act, 2023 (VASA)

Money Laundering and Terrorism (Prevention) Act (MLTPA) [Revised Edition 2011 & subsequent amendments]:

Financial Intelligence Unit Act

Identification and Verification:

Legal Persons/Arrangements (e.g., companies, trusts):

Purpose and Intended Nature of Business Relationship: Understand the purpose and intended nature of the business relationship (e.g., why the customer wants to use the VASP's services, expected transaction volumes and types).

Source of Funds/Wealth: For higher-risk customers or transactions, VASPs must take reasonable measures to establish the source of funds or source of wealth.

Continuously monitor the business relationship and transactions to ensure they are consistent with the VASP's knowledge of the customer, their business, and risk profile.

Regularly update customer information, especially for high-risk customers.

Risk-Based Approach: VASPs must apply a risk-based approach to CDD, meaning that the intensity and nature of CDD measures should be commensurate with the money laundering and terrorism financing risks identified. This involves:

Enhanced CDD (ECDD): For higher-risk situations, such as customers from high-risk jurisdictions, Politically Exposed Persons (PEPs), or complex transactions. This includes obtaining additional information, increased frequency of monitoring, and requiring senior management approval for establishing or continuing relationships.

Investment Tokens (Security Tokens): Tokens explicitly designed to represent a share in a company, a right to dividends, a portion of profits, or an interest in a collective investment scheme or fund. This includes asset-backed tokens (e.g., representing real estate, commodities, or revenue streams).

Hybrid/Utility Tokens with Investment Characteristics: If a "utility token" is sold primarily as an investment vehicle, with purchasers having an expectation of profit from the token's appreciation based on the efforts of the issuer or a third party (e.g., during an ICO where the token is not yet functional or is primarily marketed as an investment), it will likely be deemed a security. The initial sale and marketing materials are critical here.

Debt Tokens: Tokens that represent a loan or debt instrument, entitling the holder to principal repayment and/or interest payments from the issuer.

Registration of Securities: The issuer would typically be required to register the securities with the IFSC, which involves filing a prospectus or offering memorandum that provides detailed disclosure about the issuer, the token, the project, and the risks involved.

Exemptions: Certain exemptions from registration may apply, such as: