Bermuda DABA License: Digital Asset Business Classes & Fees

A Bermuda DABA license is the regulatory authorization that lets a company carry on digital asset business in or from within Bermuda. Issued by the Bermuda Monetary Authority under the Digital Asset Business Act 2018, it comes in three classes, Test, Modified and Full, each with its own requirements, fees and substance expectations.

Bermuda was one of the first jurisdictions to build a dedicated statutory regime for crypto, and the Digital Asset Business Act 2018 (DABA) remains the backbone of that framework. For founders weighing where to license an exchange, custodian or payment service, Bermuda offers a tiered path from sandbox to full authorization under a single specialist regulator. This guide explains what a Bermuda DABA license is, who needs one, the three license classes, the requirements, the 2025 fee schedule and how the application process works, with every figure tied to a Bermuda Monetary Authority primary source.

*By Magnus Müller · Reviewed by Magnus Müller · Last updated: 2026-06-14*

What Is a Bermuda DABA License?

A Bermuda DABA license is a licence issued under the Digital Asset Business Act 2018 (Act 2018:28), required to carry on digital asset business in or from within Bermuda. It is administered and supervised by the Bermuda Monetary Authority (BMA) through its FinTech Department. The licence is the legal gateway to operating a regulated crypto business from the jurisdiction.

The Act sets out a licensing regime for any person or undertaking that carries on "digital asset business" in or from within Bermuda. That phrasing is deliberate: it captures both businesses physically based in Bermuda and those operated from within the territory, so the licensing trigger is broad. If your activity falls inside the statutory definition, you need the licence before you begin.

Bermuda's approach is notable because the regime is purpose-built for digital assets rather than retrofitted from older financial-services law. The Bermuda Monetary Authority supervises licensees against published codes of practice, which gives applicants a relatively clear, documented path to authorization compared with jurisdictions still operating under interim guidance.

The Digital Asset Business Act 2018 (DABA) at a glance

The Digital Asset Business Act 2018, Act 2018:28, was enacted in 2018 and establishes the core licensing regime. It defines "digital asset business" by reference to a list of regulated activities (mapped by the BMA to section 10(2) of the Act), sets the application requirements under section 12, and provides for grant and annual fees under section 16. Together these sections frame who must be licensed, how to apply and what the BMA charges.

The statute is reinforced by the BMA's Guidance Note for prospective applicants, which translates the legal requirements into the practical documentation an applicant must submit. Reading the Act alongside the Guidance Note is the right way to understand both the legal trigger and the operational expectations.

DABA vs the Digital Asset Issuance Act 2020 (DAIA)

It is important to separate two distinct Bermuda regimes. The Digital Asset Business Act 2018 governs the licensing of digital asset businesses (exchanges, custodians, payment providers and similar). The Digital Asset Issuance Act 2020 (DAIA), Act 2020:18, governs token offerings and issuance, a separate matter from DABA licensing.

If your business model is to operate a service (run an exchange, hold client assets, process crypto payments), DABA is your regime. If your project is principally about issuing or offering a token to the public, DAIA may apply instead or in addition. Many ventures touch both, and the BMA assesses each on its facts, so map your activity to the correct Act early.

Who Regulates Digital Assets in Bermuda? The BMA

The Bermuda Monetary Authority (BMA) regulates digital assets in Bermuda. It administers the Digital Asset Business Act 2018 through its FinTech Department, assesses applications through its Assessment and Licensing Committee, and receives modern submissions through the BMA SubmIT portal. The BMA is the single specialist regulator for the entire DABA regime, which keeps the supervisory relationship in one place.

Because one authority owns the framework, applicants deal with a consistent counterparty across licensing, supervision and ongoing reporting. The BMA also publishes codes of practice and guidance, so the obligations a licensee must meet are documented rather than left to negotiation. For founders comparing jurisdictions, this single-regulator structure is part of what makes Bermuda predictable.

BMA FinTech Department and the Assessment and Licensing Committee (ALC)

Applications are handled by the BMA FinTech Department and assessed by the Assessment and Licensing Committee (ALC). The ALC is the decision body that reviews completed applications against the statutory criteria and the Guidance Note expectations. It operates on a fixed scheduling cadence, covered in the process section below, so applicants can plan their submission around the committee's calendar.

The FinTech Department is also the point of contact for pre-application engagement. Early dialogue helps an applicant scope the correct licence class and assemble the right documentation before a formal submission, which reduces the risk of back-and-forth once the ALC review begins.

Codes of practice the BMA applies

Beyond the Act itself, the BMA applies several codes of practice in the licensing and supervision of digital asset businesses. These include the DAB Code of Practice, the Digital Asset Custody Code of Practice 2024 for custodians, and the DAB Operational Cyber Risk Management Code of Practice (the "DAB Cyber Risk Code"). AML and ATF obligations apply under Bermuda's Proceeds of Crime regime alongside the BMA's General Guidance Notes.

These codes are named here as the BMA references them. The exact obligations within each code scale with the licence class and the nature of the business, so applicants should read the relevant code in full against their own activity rather than rely on a summary.

Which Activities Require a Bermuda DAB License?

You need a Bermuda DAB license if you carry on any of the regulated activities listed in section 10(2) of the Digital Asset Business Act 2018, in or from within Bermuda. The statutory list is broad and covers most of the business models a crypto company might run, from exchanges and custodians to payment providers and lenders. If your activity is on the list, the licence is mandatory before you operate.

The s.10(2) regulated activity list

The Digital Asset Business Act 2018 captures the following regulated activities under section 10(2), as set out by the BMA:

• Issuing, selling or redeeming digital assets (virtual coins, tokens or other forms of digital asset)
• Operating as a payment service provider business using digital assets, including transfer-of-funds services
• Operating a digital asset exchange
• Operating as a digital asset trust services provider
• Providing custodial wallet services
• Operating as a digital asset derivative exchange provider
• Operating as a digital asset services vendor
• Operating a digital asset lending or digital asset repurchase transactions service provider

If a venture combines several of these (for example, an exchange that also custodies client assets), the BMA assesses the full scope of activity, and the fee floors that apply later are activity-specific.

"In or from within Bermuda" scope

The licensing trigger applies to digital asset business carried on "in or from within Bermuda." This wording matters because it reaches beyond businesses that simply have a Bermuda presence. A company that operates its digital asset business from within the territory falls inside the regime even where customers or markets sit elsewhere. The practical takeaway is to confirm, early, whether your operating model is "in or from within Bermuda" so you know whether a DABA licence is required before launch.

The Three DABA License Classes: Test, Modified, Full

The Digital Asset Business Act 2018 provides three licence classes: Class T (Test), Class M (Modified) and Class F (Full). They form a ladder. Class T is a sandbox for piloting a proof of concept, Class M is for limited-period or transitional operation, and Class F is the permanent, full licence for any or all regulated activities. The right class depends on your stage of maturity and the scope of activity you intend to run.

Class T (Test License)

A Class T (Test) licence is for testing a proof of concept, minimum viable product or pilot in or from Bermuda. It has an initial duration of three to 12 months and functions as a regulatory sandbox. Class T is exempt from the head-office requirement provided the applicant submits a roadmap toward future compliance, and it requires a graduation plan describing the testing objectives, milestones and metrics that will move the business toward a fuller licence.

Class M (Modified License)

A Class M (Modified) licence suits entities expanding operations for a limited period, or businesses that do not yet meet the full Class F requirements. The BMA permits commercial activity within imposed limits and conditions, and the licensee must hold its head office in Bermuda (proportionate to scale and complexity). A graduation plan with development milestones is required, mapping the path from modified to full authorization.

Class F (Full License)

A Class F (Full) licence authorizes any or all regulated digital asset business activities on a permanent basis. It carries the highest bar: full compliance with the BMA's Head Office Guidance, comprehensive governance, compliance, internal audit, cyber and capital documentation, and board-approved frameworks. Class F applicants must propose and justify a capital model addressing the full spectrum of risks per business line. Unlike Class T and M, a Class F licence does not require a graduation plan because it is the terminal stage.

Class comparison table (T vs M vs F)

The BMA's Guidance Note summarizes the differences across the three classes as follows:

This table is the fastest way to see where a project should enter the ladder. An early-stage venture with an unproven model typically starts at Class T; a scaling business with limited live activity may fit Class M; an established operator ready for permanent, full-scope licensing targets Class F.

Bermuda DAB License Requirements

The requirements for a Bermuda DAB license cover capital and net assets, substance (a senior representative and head office), governance, cyber risk and AML/ATF compliance. The depth of documentation scales by class, so a Class T applicant faces foundational requirements while a Class F applicant must present comprehensive, board-approved frameworks. None of these requirements rests on a single fixed capital number; the BMA assesses them proportionately.

Capital and net assets (proportionate model)

The DABA regime and the BMA do not publish a single fixed minimum net-asset or paid-up-capital figure for DAB licensees. Instead, capital requirements are proportionate to the nature, scale and complexity of the proposed operations. Applicants must demonstrate sufficient net assets and an adequate liquidity position to withstand market volatility and operational demands.

Class F applicants are specifically required to propose and justify a capital model, addressing the full spectrum of risks per business line. Applicants must fully disclose capital contributions, equity investors, banking relationships and any loans or debt, with working-capital agreements, convertible notes or debt instruments expected to be fully subordinated for their term. Financial projections are required over a three-year horizon, with quarterly breakdowns for the first 12 months covering revenue estimates, growth forecasts, cash burn and capital adequacy. Because the model is proportionate, you should build your capital case around your specific activity rather than a headline figure.

Substance: senior representative and head office

Every class requires a senior representative. For Class M and Class F the senior representative must maintain an office in Bermuda; for Class T the senior representative may keep an office outside Bermuda. The senior representative cannot cease to act without 30 days' written notice to the Authority, which keeps the BMA informed of changes in a key control function.

A head office in Bermuda is required for Class M (proportionate to scale and complexity) and for Class F (full compliance with Head Office Guidance). Class T is exempt from the head-office requirement, provided the applicant submits a roadmap for future compliance. This substance gradient is one of the main reasons the tiered structure works for early-stage projects.

Governance and Three Lines of Defence (3LOD)

Governance must follow a Three Lines of Defence (3LOD) framework, with risk management spanning operational, credit, liquidity and market risk, compliance, AML/ATF, conduct risk, cyber risk and internal audit. Applicants submit a detailed ownership chart tracing through to the ultimate beneficial owners, and the BMA applies fit-and-proper tests to controllers and officers. The 3LOD model is the structure the BMA expects to see evidenced in the application, not just asserted.

Cyber risk obligations

Cyber requirements centre on a top-level Cyber Risk Policy, reviewed and approved annually by the Board, and an IT Risk Register submitted as part of the application package. Licensees must comply with the DAB Operational Cyber Risk Management Code of Practice, including its provisions on penetration testing and vulnerability assessments (s.5.17), secure application development (s.5.22) and smart-contract security testing (s.5.23). Custodians, or those outsourcing custody, must present a documented gap analysis against the Digital Asset Custody Code of Practice 2024.

AML and ATF obligations

Licensees must comply with Bermuda's AML and ATF acts and regulations, and the BMA's General Guidance Notes for regulated financial institutions apply. The depth of AML/ATF documentation scales by class: foundational for Class T, robust implementation plans with clear timelines for Class M, and comprehensive documentation for Class F. For a deeper treatment of the controls a crypto business needs across jurisdictions, see our guide to AML and KYC obligations.

How Much Does a Bermuda DAB License Cost?

Under the 2025 BMA fee schedule, the application fee is $2,266 for Class F or Class M and $1,000 for Class T. The annual fee for Class F and M is formula-based and capped at $450,000, while the Class T grant and annual fee is $1,000. Because the annual fee is a formula rather than a flat amount, the total cost depends on your activity and your estimated client receipts. These figures are from the 2025 schedule and change annually.

Application fees (s.12)

The 2025 BMA fee schedule sets the section 12 application fee at $2,266 for a Class F or Class M application and $1,000 for a Class T application. The lower Class T fee reflects the sandbox nature of the test licence. The grant and annual fee for Class T (under s.12(3) and s.16(1)) is also $1,000.

Annual / grant fee formula (s.16)

For Class F and Class M, the grant and annual fee under section 16 is formula-based, not a flat number. It is the lower of (i) $450,000 and (ii) the higher of a floor and 0.00075 multiplied by estimated client receipts. The floor depends on the activity:

Use these figures only with the 2025 year cited; the BMA updates its fees annually. There is no single "annual fee" to quote, because the charge is a formula with a $450,000 cap. For how Bermuda compares on cost with other regimes, see our overview of crypto license costs by country.

How to Apply for a Bermuda DAB License (Process and Timeline)

You apply for a Bermuda DAB license by submitting to the BMA FinTech Department through the SubmIT portal, after which the Assessment and Licensing Committee reviews your application on a four-week cycle. The application package includes institutional and personal questionnaires, financial documentation, a business plan with a product rollout roadmap, three-year projections, governance, AML and cyber documentation, a wind-down plan, and (for Class M and T) a graduation plan. The BMA does not publish a guaranteed end-to-end timeline.

Submitting through the SubmIT portal

Modern applications route through the BMA SubmIT portal, which collects the institutional questionnaire, personal questionnaires for controllers and officers, and the financial documentation. The typical deliverables set out in the Guidance Note includes the organisational and ownership structure, a business plan and product rollout roadmap with launch dates, a staffing and head-office plan, a capital structure table with three-year projections, the 3LOD governance framework, compliance, AML/ATF and cyber documentation, an internal audit charter, a wind-down plan, and a graduation plan for Class M and T applicants. Assembling a complete, well-evidenced package is the single biggest factor in a smooth review.

The ALC 4-week Thursday review cycle

The Assessment and Licensing Committee operates a fixed cadence. Per the BMA, "applications must be received by the Authority no later than 5:00 p.m. on the relevant Thursday in order to be considered by the ALC on a Thursday four weeks later." All documents must be in English. This four-week cadence is a scheduling rule for when the committee considers a complete application; it is not a guarantee of total time-to-licence. Any "two to four months" end-to-end figure is an estimate only, since the BMA does not publish a guaranteed processing time. Plan your submission around the Thursday deadline and treat overall timing as indicative.

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Is Bermuda Tax-Free for Crypto Businesses?

Bermuda has historically levied no corporate income tax, capital gains tax or income tax, which is part of its long-standing appeal as an international financial centre. However, that picture is no longer unqualified. The Corporate Income Tax Act 2023 introduced a 15% tax for in-scope large multinational enterprise (MNE) groups, effective from 2025. So while many smaller digital asset businesses may sit outside that scope, the blanket "tax-free" claim is unsafe.

Treat tax position as something to verify against a current primary government source before relying on it, especially if your group is large enough to fall within the MNE threshold. The right answer depends on your group structure and turnover, not on a general statement, and we do not present a firm tax conclusion here without a confirmed primary source.

Why Choose Bermuda for a Digital Asset Business?

Bermuda's appeal rests on a mature, dedicated statutory regime. The Digital Asset Business Act 2018 was purpose-built for crypto, supervised by a single specialist regulator (the BMA) and supported by published codes of practice. That combination delivers regulatory certainty: applicants know which Act applies, which committee decides, and which codes they will be measured against.

The tiered entry from Class T to Class M to Class F is a genuine differentiator. Early-stage projects can pilot in a sandbox before committing to full licensure, while established operators can apply directly for a Class F licence covering any or all regulated activities. For many ventures, that flexibility, paired with Bermuda's international credibility as an established financial centre, is the deciding factor. Positioning claims about banking access and market reputation should be treated as positioning rather than sourced regulatory facts.

Bermuda vs other offshore and sandbox jurisdictions

Bermuda sits alongside several peer regimes that founders typically evaluate together. Compared with Dubai VARA crypto licensing, which runs a multi-licence activity model, Bermuda's three-class ladder is simpler to map. Against the Bahrain CBB crypto licence, another sandbox-to-full regime, Bermuda offers a comparable testing path under a single Act. And relative to BVI crypto license requirements, Bermuda layers in more detailed codes of practice and an explicit graduation framework.

The best choice depends on your activity mix, target markets and stage of maturity. For a structured side-by-side, start with our pillar guide to compare crypto licensing jurisdictions, and if you are still scoping where a VASP registration makes sense, our overview of where to register a VASP licence maps the global landscape.

How Crypto-License.io Helps With Your Bermuda DABA Application

Crypto Valley Partners AG, based in Zug, Switzerland's "Crypto Valley," advises founders and operators on obtaining and maintaining crypto, VASP and digital-asset licences worldwide, including the Bermuda DABA regime. Led by crypto-licensing expert Magnus Müller, our work centres on mapping your business model to the correct licence class, scoping the proportionate capital and substance you will need, and assembling a complete, well-evidenced SubmIT application that the ALC can review without avoidable back-and-forth.

From our practice, the most common reason a digital-asset application stalls is an incomplete or inconsistent package: a capital model that does not match the projected activity, a cyber or AML section that is thinner than the licence class requires, or a graduation plan that does not connect to the stated milestones. We help align those documents to the BMA's expectations before submission, and we map the s.10(2) activity list to your model so the right fee floors and codes of practice apply. To understand how your activity maps to the broader taxonomy, see our guide to licensing by activity and business model.