For many, digital currencies like Bitcoin are still a mysterious long shot that leave more questions unanswered than answered.
Likewise, governments have reacted to the unregulated currencies—which have no national treasury or mint behind them—with a range of strict regulations to outright bans.
The Isle of Man, however, is ready to take the gamble on crypto-currency.
“Unlike jurisdictions which have made crypto currencies illegal, such as Bangladesh and Bolivia, or regulated them so fiercely that they stifle innovation entirely, like New York, the Isle of Man is welcoming them with open arms,” said Matthew Sparkes, deputy head of technology on the island in a prepared press release.
Much like when the Isle of Man embraced online gaming more than a decade ago, officials see the jurisdiction as perfect for the growth of digital currency.
The island has no capital gains tax, potentially no corporation tax and extremely low income tax. Add into that the government’s acceptance of the currency and a stable environment is created. While the Isle does regulate the crypto-currencies to a degree, they hope to only legal and financial stability, “not to squash innovation.”
Still, the Isle of Man does have to deal with the U.K., which might not be so digital-currency friendly. The protectorate—with a population of approximately 85,000—still relies on the U.K. for much, but is ultimately self-governed.
“We watched the growth of digital currencies closely throughout 2014,” Brian Donegan from the Isle of Man Department of Economic Development recently told the Irish Times. “We may be a small jurisdiction but we’re very nimble and saw an opportunity to diversify our offering. That said, we are open for digital business as long as there is appropriate regulation, we can keep crime out and ultimately protect the consumer.”
The Isle has also encouraged its local businesses to adopt Bitcoin as a legitimate currency.
“So far its arrival has been positive for the island economy,” says Donegan. “There is a small cluster of crypto currency-based companies that have established themselves here and who must incorporate their business, perform audits, handle legal issues, all of which require staff. So jobs are being created.
“It has been slow but we are beginning to see a number of businesses on the island accepting bitcoin. These are mainly corporate and retail businesses,” he said. “You can walk down the high street and buy a coffee or hail a taxi paid for with bitcoin.”
