Barbados Brings Its Virtual Asset Service Providers Act Into Force, Giving Existing Firms Three Months to Apply

Barbados now has a licensing law for crypto businesses. The Virtual Asset Service Providers Act, 2026 (Act 2026-25) received presidential assent on 16 October 2026 and, according to the Official Gazette published the same day, commenced on that date. The Act makes the Financial Services Commission (FSC) the regulator for exchanges, custodians, brokers, transfer services and other virtual asset businesses that serve people in Barbados.

The most immediate consequence is a transition deadline. Under section 27, any provider that was already serving Barbados before commencement must inform the FSC and apply for a licence or a certificate of registration within three months of commencement. Counted from 16 October 2026, that period runs to 16 January 2027. As of 4 November 2026, the FSC's public notices page did not yet list a notice on the Act, application forms or fees.

What the Act Covers and Who Needs Permission

Section 6 prohibits anyone from carrying on the business of providing virtual asset services in, or to persons in, Barbados without a licence, a provisional licence or a certificate of registration. A breach is an offence carrying a fine of $200 000 on summary conviction. The definition of virtual asset service covers exchange services (crypto to crypto and crypto to fiat), custody of assets or private keys, transfer and payment services, brokerage and over-the-counter dealing, advisory and portfolio management, credit intermediation involving virtual assets, and issuance-related services. Software development, mining and validation, self-hosted wallets and trading on one's own account are excluded, as are central bank digital money, securities derivatives and fund interests regulated under other laws.

Licence applicants must be companies or societies with restricted liability formed under Barbados law. Section 7 lists what the FSC will examine, including ownership and control, governance, customer profile, capital, risk management, anti-money laundering systems under the Money Laundering and Financing of Terrorism (Prevention and Control) Act, 2011, custody arrangements, cybersecurity, market abuse detection, complaints handling and wind-down plans. A firm that wants to conduct stablecoin business must also submit a letter of non-objection from the Central Bank of Barbados. The FSC may not issue a licence where an applicant gave false information, where the applicant or a director, senior officer or beneficial owner has a money laundering or terrorist financing conviction, or where the activity cannot be effectively supervised.

The Act also creates a provisional licence for testing genuinely novel products, normally for up to 12 months with conditions on customer numbers, retail exposure and transaction limits, and a separate route for foreign providers. Under section 17, a foreign firm applies for registration, and the FSC decides whether a territorial nexus exists and whether to grant a certificate of registration or require a full licence. The factors include targeted marketing, Barbados-directed onboarding, repeated service, local agents or infrastructure, volumes, retail exposure and whether the firm is supervised abroad. The Act states that the mere accessibility of a website from Barbados or an unsolicited customer relationship does not, of itself, establish a nexus.

Ongoing Duties for Licensed and Registered Firms

Part IV applies to all providers. Firms must keep a representative and a registered office in Barbados, scaled to the nature, size and risk of the business. They must segregate client assets, prevent commingling, run reconciliations, meet any minimum capital the FSC specifies, and keep records that allow client assets to be returned in an insolvency. Where the FSC requires it, custodians must apply controls on multi-signature arrangements, cold storage, private-key management and insurance or compensation.

Section 22 brings the FATF travel rule into statute. For transfers at or above a threshold set by the FSC, providers must obtain, verify and transmit originator and beneficiary information immediately and securely. Below the threshold they must collect names and wallet addresses or a transaction reference. Firms must also give customers clear disclosures on fees, risks, conflicts, custody, outages and insolvency rights, and the FSC must keep a public register of every licence, provisional licence and registration it issues.

The Act's schedule makes consequential amendments to the Financial Services Commission Act, 2010, the Money Laundering and Financing of Terrorism (Prevention and Control) Act, 2011 and the Beneficial Ownership Transparency and Register Act, 2026.

Background and What Comes Next

The law moved quickly. According to the Parliament's bill record, the House of Assembly passed the bill in all stages on 6 October 2026 and the Senate did so on 14 October 2026, with no amendments recorded. It follows FSC preparatory work: an April 2026 consultation paper on a VASP framework that cited FATF Recommendations 15 and 16, and a July 2026 request asking anyone operating or planning to operate as a VASP in Barbados to identify themselves by 31 July 2026 for a sectoral risk assessment.

Much of the detail is still to come. The Act leaves application forms, fees, capital levels and the travel rule threshold to the FSC, which may issue guidelines (to be noticed in the Official Gazette) and regulations, including on additional services and on decentralised finance protocols and DAOs. Existing providers should not wait for that detail: the three-month notification and application window under section 27 is already running. Firms should watch the FSC's public notices page for application procedures and, once licences are issued, the FSC register.