VASP REGISTRATION
VASP Registration (Phase 1)
For VASP activities other than custody and trading platform: issuance, transfer, advisory. Registration with CIMA, AML/CFT compliance, without custodial risk.
Low risk03 · VASP Act 2024 · Phase 2 from 04/01/2025
CIMA VASP license -
institutional
crypto mode.
Cayman is the global standard for crypto funds and regulated VASPs. Phase 2 licensing came into force on April 1, 2025: custody providers and trading platforms are now required to obtain a full license. Sandbox, DAO foundations, tokenized funds - separate tracks.
License types
Six tracks
under crypto business
The VASP Act 2024 (Revision) and the 2025 amendments provide clear categories. The level of risk depends on: registration or full license, capital requirements, directors and compliance.
FULL VASP LICENSE
Full VASP License (Phase 2)
Mandatory from 04/01/2025 for custody and trading platform. Min 3 directors (1 independent), $100k capital, AML officer on the islands, extended compliance framework.
Custom · ExchangeSANDBOX LICENSE
Sandbox License
12-month regime for innovative business models that do not fit into standard categories. Afterwards - transition to a permanent license or registration. Direct supervision of CIMA.
InnovationDAO FOUNDATION
DAO Foundation Company
Foundation Company as a legal wrapper for DAO. Protection of members from personal liability, treasury management, token issuance. 1,700+ registered.
DeFi DAOTOKENISED FUND
Tokenized Fund
Fund under MFA/PFA with tokenized interests. Exception from VASP mode if crypto-deal is incidental to stock activity. Legislative update 2026 gives clarity.
Web3-fundsCRYPTO HEDGE FUND
Crypto Hedge Fund
A fund that invests in crypto assets. Under MFA or PFA. Not a VASP per se. Cayman is #1 for crypto funds: 58% of the global market is registered here.
Investment fundsVASP in numbers · 2026
- VASP registered (February 2026)
- 19 active
- Crypto Foundations
- 1 700+
- Crypto hedge funds (world share)
- 58%
- Regulator
- CIMA Est. 1997
- Basic Law
- VASP Act (2024 Revision)
- Application fee (registration)
- $1 000
- Annual fees
- $5,000 – $200,000 KYD
- Min. paid-up capital
- $100 000
- Minimum of directors (License)
- 3 (1 independent)
- Review period
- 4–10 months
Phase 2 · what has changed
From April 1, 2025 -
new mode
Until 2025, VASP providers could operate using simplified registration. With Phase 2, the rules have become stricter for the two riskiest categories: custody providers and trading platforms.
- !Custody = License requiredPhase 2
Any services for storing other people's crypto assets: hot/cold wallets, multi-sig custody, key management.
- !Trading Platform = License requiredPhase 2
Exchanges, OTC desktop with order matching, marketplaces, any infrastructure for P2P cryptocurrency trading.
- 3Minimum 3 directorsgovernance
Including 1 independent, not affiliated with the business. Everyone passes CIMA fit & proper.
- $$100k minimum capitalcapital
Paid-up share capital must be paid at the time of application. Documented by the auditor.
- ⚙Advanced compliance frameworkframework
AML/CFT, cybersecurity, business continuity plan, customer protection, segregation of client assets.
The process of obtaining a VASP License
4 phases -
from scoping to approval
The actual period for obtaining a Full VASP License is 6–10 months. The main bottlenecks: preparation of a cybersecurity framework, approval of the Business Continuity Plan and due diligence for directors.
1
Phase I Weeks 1–3
Scoping
Business model analysis, classification (Phase 1 vs Phase 2), incorporation Exempted Company, KYC of directors.
2
Phase II Weeks 4–12
Documentation
Business Plan, Risk Assessment, AML/CFT Manual, Cybersecurity Policy, Business Continuity Plan, Customer Protection.
3
Phase III Weeks 12–28
REEFS submission
Submission via CIMA REEFS-portal. Fit & Proper for all directors. Proof of capital. Responses to CIMA RFI.
4
Phase IV ongoing
Post-licensing
Annual returns, Travel Rule compliance, audited financial statements, direct CIMA audits, banking introductions.
Application
What does it cover?
VASP mode
The regulator has a broad approach: everything related to the movement, storage or exchange of virtual assets on a commercial basis. Simple NFT mints without secondary trading are not regulated.
Crypto Exchange
Spot and derivatives exchanges, P2P marketplaces. Order book matching, holding client funds, brokerage and dealing functions.
Crypto Custody
Custodial wallets (hot/cold), storage of private keys or multi-sig. Institutional custodians, mass-market wallet providers.
OTC Desk
Over-the-counter crypto trading between clients or with a principal. Regulated as a trading platform with order matching.
Token Issue
Issue of utility/security tokens for ICO/IDO/ICO. Only for public issue - private placement to accredited investors is a separate mode.
Crypto Payments
Payment processors with crypto↔fiat conversion. VASP + approval with traditional banking partners is required.
Investment Advisory
Consulting on the purchase/sale of virtual assets. Phase 1 registration. SIBA-license with advisory on security tokens.
Often asked
VASP - no guesswork
Is it possible to launch a crypto project without a VASP license?
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Yes, in three cases. First, if you do not provide VASP services (for example, you are developing a non-custodial wallet or smart contract - the user manages the keys himself). The second is a crypto fund under MFA/PFA, where crypto activity is incidental to fund activity. Third - DAO foundation without commercial activities (just a wrapper for governance). Custody, exchange and token issuance to public are required to be licensed.
How much does it cost to obtain a Full VASP License?
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CIMA government fees: $1,000 application fee + annual fee from $5,000 KYD to $200,000 KYD depending on the type of service. Professional support (lawyers, AML consultants, cybersecurity audit): $80,000 - $150,000 for the full package. Local AML officer: $40,000 - 60,000 per year. Local office space: $24,000+ per year. First year total: $150–250k for a fully operational VASP.
Is a VASP license recognized in other jurisdictions?
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Cayman VASP is an institutionally recognized Tier-1 license. Large banks (Goldman, JP Morgan, BNY Mellon) and prime brokers work with licensed Cayman VASPs. For retail-passporting in the EU, you need a separate MiCA CASP license (Cyprus, Malta, Lithuania, Germany are the most popular). For the US - separate state money transmitter licenses + potentially BitLicense (NY). Cayman + Cyprus MiCA is a frequent parallel design for institutional players.
What is CARF and when does it take effect?
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CARF (Crypto-Asset Reporting Framework) is a new OECD standard for the automatic exchange of information on crypto assets between tax authorities. Analogue of CRS for crypto. Cayman implemented CARF as of January 1, 2026. VASPs are required to identify clients' tax residence and report transactions annually. This significantly changes the landscape of privacy-coins and anonymous VASPs.
Can we register a DAO without a VASP license?
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Yes, as a Foundation Company under the Foundation Companies Act 2017. This is the most popular legal wrapper for DAO in the world - 1,700+ registered. A Foundation Company can own treasury, issue governance tokens, and enter into contracts. A VASP license is NOT required if the DAO does not provide paid custody/exchange services to third parties. If DAO works as a protocol with its own AMM, analysis is needed for a conkrete scenario.
Are you running VASP?
Let's start with scoping sessions
Describe your business model - we will determine whether registration, License or sandbox is required. Free session, under NDA, no obligations.