The Managing PArtner's column

In principle approval for first VASP licences: A turning point for Mauritius.

The Financial Services Commission (‘FSC’) has announced that it has issued 5 in principle approvals under the new VAITOS Act 2021.

The announcement comes in the wake of, founded by former Binance CFO Wei Zhou, which aspires to be one of the leading cryptocurrency exchanges globally, releasing a statement to the effect that it has been granted in principle approvals by the Mauritian regulator for four out of the five Virtual Asset Service Provider (VASP) licences under the VAITOS ACT.

Mr. Zhou had this to say following the positive developments in Mauritius: “As we work closely with regulators to ensure that our operations are safe and secure, obtaining the four virtual asset service provider licenses from the FSC is a positive step towards sharing our financial services with more people across the globe.

Juridis is proud to have assisted, which will be the first ever cryptocurrency exchange to be
regulated in and operate from Mauritius, in the implementation of its global expansion strategy.

But what does this effectively mean for the Jurisdiction?
Mauritius was in December 2021 amongst the first countries in the Eastern and Southern African Region to adopt a comprehensive legislation on Virtual Asset and Initial Token Offering Services. In doing so the Mauritian government’s strategy was admittedly “to harness the benefits of the new and developing business activities of virtual assets and initial token offerings and to become a
regional FinTech Hub for Africa.” 1

Over the last ten years, decentralized finance solutions, have attracted a lot attention from investors across the globe with the cryptocurrencies market capitalization going up to $3 trillion at its peak in November 2021. While the price volatility of cryptocurrencies remains an issue, in 2022, global market capitalization still stood at $1 trillion. Furthermore, given the irrefutable nature of
Blockchain, tokenisation when it comes to asset ownership is another growing trend. From works of art to real estate or even gold, you name it! Tokenisation is set to take over the world. “Tokenization, if combined with efficient exchange mechanisms, may significantly improve the liquidity of assets traditionally regarded as illiquid.” 2

Because of the inherent risks in terms of money laundering and terrorism financing and other financial and cyber crimes, virtual asset entrepreneurs are increasingly looking for regulated
environments to support their quests for innovation.

Mauritius’ willingness to launch a new chapter of its economic revolution based on a renewed vision to be a regional hub for innovation, is dependent on its ability to attract world leading Blockchain operators, crypto exchanges and other VASPs, and NFT issuers.

Although it has taken more than a year for the first approvals to be issued following the adoption of the new regulatory framework, the forthcoming issue of licences under the VAITOS regime will no doubt be a turning point, sending the right signal to the tech community worldwide that Mauritius is open for business. Our robust regulatory framework, designed to ensure that VASPs operate in a transparent and accountable manner, while complying the Financial Action Task Force (FATF) recommendations and best global AML/CFT practices, coupled with our solid reputation as a business oriented financial services centre, will be an enticing proposition which will surely attract more and more investors. The many queries operators are already getting is testament to this.

We however need to remain competitive as other African countries are also positioning themselves as technological and innovation hubs. Nigeria is but an example. In 2022, the Securities and Exchange Commission announced that it published “rules on issuance, offering platforms and custody of digital assets” for virtual technologies.

Elsewhere, Dubai is increasingly establishing itself as a focal point for tech investors with over 30 licences issued since the legislation on the Regulation of Virtual Assets in the Emirate of Dubai
entered into force in March 2022, including to giants Binance and FTX.

In the face of such mounting competition, it is absolutely crucial that our regulator remains agile by, ensuring strict compliance with our regulatory framework and addressing potential risks with the ultimate objective of protecting investors and consumers, but also by delivering licences and authorisations within timeframes that keep the jurisdiction competitive and by actively engaging
with VASPs, industry stakeholders, and other regulators to get their feedback and understand their concerns.

A sustained effort both from the authorities and the industry operators to proactively promote the jurisdiction as a preferred destination for VASPs through targeted marketing efforts, industry partnerships, and participation in international fora and events is also central to our strategy to enhance our profile within the global cryptocurrency community and position ourselves as a leading
and competitive jurisdiction for virtual asset services. Attracting global players like can without the shadow of a doubt act as a trigger for this.

1 M. Seeruttun, Minister of Financial Services and Good Governance, VAITOS Bill Second Reading, Hansard No.
32 of 2021
2 Virtual assets and effective regulation | EY – US

Key Contacts


Nilen Vencadasmy

Managing Partner