Introduction

Mauritius, a progressive island nation in the Indian Ocean, has strategically positioned itself as a modern financial centre. With the increasing influence of blockchain technology and digital currencies, the country has taken a proactive approach by regulating virtual assets (VAs) and virtual asset service providers (VASPs). This regulatory initiative aims to protect users, ensure financial stability, and promote innovation.

Advantages of Holding a VASP Licence

• Stronger Market Reputation:
  A VASP licence lends credibility to service providers by confirming they operate within a well-regulated and secure legal environment.
• Boosted Investor Trust:
  Regulatory oversight reassures investors and encourages greater participation in the virtual asset market.
• Support for Innovation:
  Clear regulatory guidance creates a supportive environment for developing new financial technologies and services.

Legal and Regulatory Framework

The licensing and oversight of VASPs in Mauritius are overseen by the Financial Services Commission (FSC) under:

• The Financial Services Act
• The Virtual Asset and Initial Token Offering Services Act 2021 (VAITOS Act)

This framework ensures that the virtual asset industry operates with transparency, security, and integrity.

Objectives of the VAITOS Act

• Promote a safe and reliable virtual asset market
• Combat money laundering and terrorism financing
• Protect the interests of consumers and investors
• Strengthen Mauritius’s image as a reputable financial jurisdiction

Coverage of the VAITOS Act

The VAITOS Act applies to:

• Virtual Asset Services: Includes currency and asset exchanges, transfers, storage, and related financial services.
• Initial Token Offerings (ITOs): Regulates public offerings of new digital tokens.

Types of VASP Licences in Mauritius

1. Class M – Broker/Dealer
   • Role: Acts as a middleman in virtual asset trades.
   • Services: Facilitates trading, liquidity provision, order execution, and potentially market analysis.
2. Class O – Wallet Services
   • Role: Offers digital wallet services.
   • Services: Manages digital wallets, private keys, and asset transfers between wallets or platforms.
3. Class R – Custodian
   • Role: Ensures secure storage of virtual assets.
   • Services: Implements safety measures, manages custody and administrative control over clients’ digital assets.
4. Class I – Advisory Services
   • Role: Provides expert advice on virtual assets.
   • Services: Assists with strategy, regulatory compliance, investment guidance, and ongoing project support.
5. Class S – Market Place
   • Role: Operates virtual asset trading platforms.

Services: Enables exchanges between virtual assets and fiat currencies or other digital assets.