Equity, Digitised: Tokenising Cayman Islands and BVI Fund Interests & Shares
- Published
- in Analysis & Insights
Introduction of Tokenised Equity Interests in the Cayman Islands and BVI: An Overview.
The Cayman Islands and the British Virgin Islands (“BVI”) occupy a leading position in the global investment funds landscape.
With over 18,000 private funds and 13,000 mutual funds registered with the Cayman Islands Monetary Authority (“CIMA”), and a deep, complementary fund ecosystem in the BVI, both jurisdictions have long served as the domicile of choice for institutional capital. In parallel, Cayman Islands exempted companies are a popular choice for public listings on major stock exchanges, including The Stock Exchange of Hong Kong (the “HKEX”), New York Stock Exchange (NYSE) and Nasdaq, using the jurisdiction’s flexible corporate law framework to access global equity capital markets.
Against this established framework, tokenisation (the digital representation of equity or investment interests as tokens on a distributed ledger) has moved rapidly from concept to deployment. Leading commentators predict that the tokenisation of real-world assets will scale to a multi-trillion dollar market by 2030. Crucially, the operational efficiencies inherent in tokenisation, including near-instantaneous settlement, reduced reliance on intermediaries and lower administration costs, have the potential to compress fund operating expenses and, in turn, enhance net returns to investors.
The Cayman Islands has responded decisively, enacting a comprehensive legislative framework in March 2026 that provides statutory clarity for tokenised fund structures, while the BVI continues to track similar demand from managers and allocators.
In the Cayman Islands, the March 2026 reforms comprising amendments to the Mutual Funds Act, the Private Funds Act and the Virtual Asset (Service Providers) Act provide express statutory clarity for tokenised fund structures, including a confirmed exclusion from virtual asset service provider registration for regulated funds issuing tokenised interests. The reforms are examined in sections Challenges of Tokenisation for Investment Funds and Public Companies and Practical Considerations for Adoption.
This article examines the legal, regulatory and practical dimensions of tokenising equity interests in Cayman Islands and BVI structures, addressing both investment funds and publicly listed companies.
