Crypto Valley Summit, a two-day conference aimed at launching the Isle of Man as a prime location for bitcoin businesses, kicked off today in the wake of news that threatened to undermine its central goal.Just one day before the conference of more than 200 attendees began, a firm providing banking facilities to bitcoin businesses on the island announced it would close those accounts under pressure from its partner banks.Still, the event was opened resiliently by the Isle of Man's Lieutenant Governor, Adam Wood, who extolled the island's ability to take advantage of a rising interest in digital currencies."The rapid development of digital currencies is leaving legislators and regulators playing catch-up.This is where the Isle of Man's small size works to its advantage.It's agile and we can make an appropriate response in record time."A panel on banking garnered the most attention, as R Paul Davis, the most visible digital currency proponent on the island, decried the banks' decision to cut ties with domestic bitcoin businesses.

Davis addressed the crowd and this most recent news head on, saying: "HSBC closed CTS' corporate accounts because it objected to bitcoin transactions flowing through it."Davis went on to state that banks like Barclays were invited to speak at the event, but demurred following "national discussions".Davis also announced that a merchant services firm based in the US called Instabill would pick up the slack from CTS' account closures."[Instabill] would be able to fairly quickly replace everything CTS is offering with the exception of UK Faster Payments.I have warned [Instabill's CEO] that his only real danger is being killed in the rush."Davis also offered his predictions on which banks would recognise the opportunity in digital currencies, and which would fall behind, asserting that Spanish megabank Santander would be first to capitalise on cryptocurrency given its exposure to Latin American markets where remittances and online payments are in demand.He said banks like HSBC and Barclays, which have faced recent sanctions from regulators, would be last.

The regulatory panel, which included David Hodgson, deputy director for authorisations at the island's financial regulator, the Financial Supervision Commission, was largely positive on the development of digital currencies on the island."My view is that where the Isle of Man government has decided to place itself, bringing in the AML [anti-money laundering] regulations is appropriate," Hodgson said, referring to the island's requirement that digital currency firms have to register with the FSC for AML oversight.bitcoin most profitable poolJohn Spellman, the island's director of financial services, likened digital currencies at present to earlier payment systems, which met with initial resistance before widespread adoption.bitcoin ted talkDrawing comparison to debit cards, Spellman said: "The idea of validating yourself with a PIN was bizarre.bitcoin value nz

I see digital currencies as being in the same place."Simon Dixon, of Bank to the Future, talked up the Isle of Man's potential to become a prime location for bitcoin firms on a panel he shared with Max Keiser, host of the television programme The Keiser Report.Dixon threw jabs at London and rival offshore jurisdiction Jersey: "This is the ideal jurisdiction to disrupt the [banking] market.The jurisdiction that will win is not London [... and] despite the fact that Jersey reactionarily came along after the Isle of Man, it is a banking island, I think there will be a lot of politics involved with a new form of finance."ethereum stagesThe Isle of Man has a large online gambling industry, comprising about 10% of its gross domestic product.ethereum gbp chartFirms like online poker giant Pokerstars are based on the island.bitcoin wmz exchange

Panellists on the session on gaming and cryptocurrencies welcomed the greater adoption of digital currency globally, with one panellist noting that cryptocurrencies could potentially offer greater profit margins to gaming operators.On the sidelines, investor Brock Pierce, who is a co-founder of Isle of Man-based GoCoin, was effusive in his praise for the event.Pierce's remarks captured the optimism of the event: "It's so refreshing hearing from government officials and regulators who are positive about digital currencies.paypal bitcoin announcementThe Isle of Man is the centre of the bitcoin universe now."bit 365 bitcoinFeatured image of Isle of Man Lieutenant Governor Adam Wood via Crypto Valley Summit The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies.bitcoin con ps3

R Paul Davis is Group General Counsel for the Counting House Services group of companies, headquartered in Canada, and lives and works in the Isle of Man.A Canadian barrister and solicitor, his practice is specialized in international payments law and technology.The Isle of Man seems to be setting itself up as a hub for bitcoin-related businesses.The self-governing British Crown dependency is already appealing to conventional businesses and wealthy individuals, and the latest indications are that this fiscally liberal environment will be extended to cryptocurrency-related activities as well.On Wednesday 26th March, the island's Financial Supervision Commission, responding to a legal opinion written for Canadian clients by the author, confirmed that a bitcoin exchange that holds client funds with a licensed overseas payment service provider is not required to obtain a licence in the country for its activities.The FSC confirmed that neither Class 2 of the Regulated Activities Order, “Investment Business,” nor Class 8 “Money Transmission Services” cover bitcoin exchange activities.

This situation may not last forever, however.“[...] it is possible that legislation could be amended in the future to bring the proposed activities within regulated activity and/or to make the activity subject to the AML Code and thus subject to the draft Designated Businesses (Registration and Oversight) Bill 2014.It is therefore important that if the client pursues its interest in operating from the Isle of Man that it keeps abreast of relevant legislative changes and remains prepared for these possible eventualities.” While the thought of operating a digital exchange within the regulatory framework of the FSC might be considered an unwelcome addition to activities, in fact several exchange operators considering the Isle of Man as a base would welcome their business being subjected to regulation.This would open the doors of at least two specialized island banks who are ready to offer facilities to regulated entities, but not to unlicensed businesses.Only very minor changes to a statutory instrument, not even primary legislation, could achieve regulation.

It is likely, however, that the FSC would want considerable time to enhance its understanding of the field and put appropriate mechanisms and staff training place before taking on a new vertical.The Isle of Man is highly attractive to e-business not least because of its low tax regime, where resident individuals are taxed at 20% to a maximum of £120,000 per year, while businesses pay no corporate tax and banks only 10%.The island also boasts massive bandwith and redundancy, with world-class DDoS protection and multiple options for secure hosting.Long renowned as a safe and compliant financial centre, the cachet of an Isle of Man base is highly desirable and in the wake of the FSC decision, two well-known bitcoin exchanges have already incorporated on the island, have established facilities and are recruiting staff.Eric Benz of the UK Digital Currency Association has said that up to 15 further exchanges may now seriously consider basing operations on the island.On 1st April, approximately 30 individuals from the Island with interests in the bitcoin arena, ranging from hosting services and bankers to miners and exchange operators, will meet to form the Manx Digital Currency Association.