On Friday 22nd March 2024, a delegation from the Financial Services Authority (FSA) hosted a presentation for Members of the National Assembly on the proposed Virtual Asset (VA)/Virtual Asset Service Providers (VASP) Framework. The delegation was comprised of the CEO of FSA Mr. Randolf Samson, FSA Policy Manager Mr. Marcus Elizabeth, FSA Legal Officer Ms. Arlette Hoareau, FSA Policy Analyst Mr. Eric D’Souza, CBS Senior Financial Inclusion Analyst Mrs. Audrey Chetty, CBS Senior Financial Surveillance Analyst Mrs. Daniele Chetty, FIU Ag. Head of Monitoring and Analysis Ms. Samantha Bradburn, and the Manager for Policy & External Relations, Ms. Valentina Barra.
The aim of the presentation was to provide the Members with an overview of the developments in financial services, the growth of virtual assets, and the regulatory framework required to ensure that it is a stable and safe form of engagement publicly. A Virtual Asset was defined as a digital representation of value that can be digitally traded or transferred, and used for payment or investment purposes, with examples including cryptocurrency, platform tokens, non-fungible tokens (NFTs), among others. It was noted that the use of virtual assets had the benefit of reduced personal information exposure and risk of fraud due to cryptographic techniques, making it an attractive platform of investment for many individuals. However, the need for public sensitisation of the risks involved was heavily emphasised such as the possibility for price volatility, regulatory uncertainty, and a lack of investor protection.
The delegation stressed the need for a legislative framework to govern and delegate powers to regulatory bodies to ensure that the growing use of VA/VASP is monitored and legitimised, in order to protect ordinary citizens as well as protecting the reputation of Seychelles in the global financial market. Following the National Risk Assessment, which was undertaken by FSA in 2022, several proposals for the licensing and eligibility were brought forward for consideration. The Members present were given the opportunity to discuss these governance proposals and give their opinions on the most fruitful ways to bring this framework into reality.
Ultimately the presentation yielded a successful discussion on the legislative capacity required to create the framework governing the use of VA/VASP in Seychelles.
