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The Isle of Man is courting blockchain-focused businesses to set up shop on the island, with two initiatives designed to help firms overcome the emerging regulatory hurdles in this burgeoning area of technology.
The first initiative, dubbed the Blockchain Office, is essentially an advisory body that will provide regulatory guidance to businesses. The second, the Isle of Man Sandbox, will offer working space to companies to develop and test their blockchain platforms in a contained environment.
The two initiatives have been in development since September 2018 and are designed by Digital Isle of Man, an executive agency within the island’s Department for Enterprise, to be complementary.
Applications for the Sandbox will open in March 2019 and can be made directly to the Blockchain Office, which also doubles up as an accelerator of sorts by offering participants support to grow their businesses.
“The creation of the Blockchain Office solidifies our commitment to maintaining our reputation at the forefront of innovation and emerging technologies and responding quickly to new business models,” said Daphne Caine, political member for Digital Isle of Man.
“It is encouraging to see that the sector is supported by a community of legal, accountancy and fiduciary firms, service providers and advisers, and the island’s long-established financial services and e-gaming sectors act as a strong foundation for the industry,” she added.
Lyle Wraxall, CEO of Digital Isle of Man, said: “We are looking to attract premium blockchain businesses and the world’s top exchanges to the island, and we will be creating new tech-agnostic regulation inspired by best practice that we have seen from other high-quality jurisdictions around the world.”
Digital Isle of Man said it will implement a “robust selection process” for Sandbox participants which is currently being finalised.
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The initiatives are part of an ongoing push by the Isle of Man – a self-governing British Crown dependency – to reposition itself as an international startup hub.
This has been helped by the island’s tax regime, which makes entrepreneurs exempt from capital gains tax if they establish a business on the island. The island also has one of the lowest personal tax rates in the world, and has had a 0% corporate tax rate since April 2006.
Now, because of the government’s manoeuvring to attract tech companies and startups, a quarter of the island’s gross domestic product comes from e-business ventures – up 15% from 10 years ago.
Laura Bailey, chair of Qadre, one of the many blockchain businesses already based on the island, said: “Collaboration with the Isle of Man government has been of utmost importance to us since our inception. We are proud to have a base in a jurisdiction that embraces technology and is at the forefront of providing regulatory guidelines to business.”
Bailey added: “The launch of the Blockchain Office represents a key milestone for the island – and we are delighted to now have a formal partner dedicated to driving growth and innovation in blockchain technology right on our doorstep.”