Nauru has recently passed a bill establishing the Command Ridge Virtual Asset Authority (CRVAA) to regulate virtual assets, digital banking, and Web3 innovation.
CRVAA to Issue VASP licences
Nauru, the tiny island nation in the South Pacific Ocean, recently passed a bill establishing a dedicated virtual asset regulatory authority. The bill, which passed June 17, creates the Command Ridge Virtual Asset Authority (CRVAA), mandated to oversee virtual assets, digital banking and Web3 innovation. It will also issue licenses to virtual asset service providers (VASPs) seeking to offer their services using Nauru as a base.
Nauru President David Adeang lauded the law’s passage, saying it lays the groundwork for his island nation to become a digital asset leader in the region. The law is also seen as strengthening the country’s financial integrity and forging new pathways for resilience.
“This bold step aims to harness the potential of virtual assets to diversify revenue streams and fortify economic resilience,” Adeang stated. “By implementing robust oversight of VASPs, Nauru aims to foster sustainable growth, channel new financial inflows into strategic instruments such as its Intergenerational Trust Fund, and reduce its reliance on climate financing, which is often challenging to secure.”
The island nation reportedly faces significant risks, a fact officially recognized by the United Nations Multidimensional Vulnerability Index (MVI). The MVI highlights Nauru’s extreme susceptibility to both economic and environmental shocks. To combat these challenges, Nauru must proactively embrace innovation, virtual assets can potentially make the country less susceptible to economic and environmental shocks.
Maverick Eoe, the commerce and foreign investment minister, meanwhile, argued that the law’s passage “puts Nauru on par with other countries leading in the development of their digital economies and generating revenue from such developments.”
In addition to issuing licenses, the CRVAA will also be tasked with upholding cybersecurity standards, monitoring financial transactions and enforcing compliance. Under the new law, cryptocurrencies are presumed to be commodities, not securities. Furthermore, utility and payment tokens are excluded from investment contract status, while “governance and reward tokens are protected from misclassification.”
Source: Bitcoin
