Central Bank of Cuba to License Digital Asset Service Providers

The Central Bank of Cuba (BCC) will issue licenses for virtual asset service providers.

According to a Spanish-language resolution published in Cuba's official gazette on Tuesday, the license will be available to individuals or organizations both Cuban and foreign.

The approved licenses will be valid for one year and may be extended for a second year, “given the experimental and novel nature of this type of activity,” the BCC said.

The providers will be allowed to operate with virtual assets approved by the BCC, the resolution said without disclosing further details. It did clarify that virtual assets “do not include digital representations of fiat currency, securities and other financial assets widely used in traditional banking and financial systems, which are regulated in other provisions of the Central Bank of Cuba.”

In August, the BCC issued a resolution establishing rules to regulate the use of virtual assets in commercial transactions and licensing of service providers in that sector.

That previous resolution allowed the bank to grant licenses to “service providers of virtual assets for transactions related to financial, exchange and collection or payment activities, in and from the national territory,” the BCC said on Thursday.

At that moment, the BCC stipulated that government agencies must refrain from using virtual assets in transactions, except in cases it authorizes.

The current resolution didn't specify how the Cuban government will levy taxes on the virtual assets activity.

It stipulates the BCC will provide or deny the requested license "in a term that in its totality does not exceed ninety working days from the date of receipt of the required documentation." In order to issue a license, the BCC will first consult with a "crypto assets group."

According to the bank, the resolution will be effective 20 days after its publication.

In addition, providers will not be able to cease operations without prior authorization from the BCC and will have to keep accounting records of their operations according to the standards issued by the Ministry of Finance and Prices, based on the approved Cuban Financial Reporting Standards.

The BCC specified that those licensees who violate the resolution or who operate without a license will be penalized under Decree 363, which deals with administrative violations of banking, financial and foreign exchange provisions.