By Anayat Durrani and Uglobal Staff
For many investors, getting a second passport means securing a coveted exit strategy. A second citizenship or golden visa can open up many doors, bring lower taxes, asset protection, and greater freedom.
Investor visa programs typically attract the wealthy, including individuals in the bitcoin world seeking to use the currency as a form of payment to secure their “plan B.”
The latest country to join the bitcoin wave is Cayman Islands, which offers permanent residency visas to foreign investors with a pathway to citizenship.
Ledn, a cryptocurrency provider since 2018, has announced a new partnership with Parallel, Cayman’s crypto real estate broker. The partnership will allow a FIAT-free way for investors to finance and purchase real estate in the Cayman Islands using digital assets to qualify for a golden visa. Both companies are regulated by the Cayman Islands Monetary Authority (CIMA) as Virtual Asset Service Providers.
Laura Birrell, CEO of Parallel, said in a statement that clients will no longer “have to decide between holding on to their crypto or purchasing that luxury property… — now they can do both.”
The quickest route to permanent residency in the Cayman Islands is by investing at least $2.4 million in real estate.
Investor visa programs that welcome crypto today
“Vanuatu was the first country that officially accepted bitcoin payments in exchange for citizenship,” says Patricia Casaburi, managing director for Global Citizen Solutions, a boutique investment migration consultancy. “And in 2018, Antigua and Barbuda announced that the country would be using bitcoin legally as a form of payment in the Citizenship by Investment Program.”
Vanuatu is an archipelago in the South Pacific Ocean known for its beautiful beaches, lush rainforests, and vibrant culture. Passports are available in about a month. The former British colonies of Antigua & Barbuda are island nations located in the Caribbean. These locales are popular CBI choices for investors.
“On the other hand, St Kitts and Nevis has not officially accepted cryptocurrency as a form of payment for its citizenship by investment program, but it has passed legislation supporting virtual or digital assets and digital currency exchanges,” says Casaburi.
St. Kitts and Nevis Citizenship by Investment Program was the first program of its kind, launched in 1984. Now more than 20 countries worldwide have CBI programs. Among the most friendly to cryptocurrency are the Caribbean countries.
Countries in the Caribbean with CBI programs allow applicants to use crypto as a form of payment for the application process to gain a second passport. The money is then transferred into US dollars.
“If bitcoiners have earned their money legally and can provide evidence of it, they can apply for citizenship in any country worldwide,” says Nuri Katz, founder of Apex Capital Partners. “This opportunity extends to countries in both Europe and the Caribbean.”
A small country in Central America could soon be making an entrance into the crypto residency by investment world.
“One country that is noteworthy for bitcoiners is El Salvador, an early adopter of bitcoin as their official currency,” says Casaburi. “El Salvador is currently set to launch a residency by investment program which will allow investors to pay by bitcoin.”
Challenges for investing in visas and passports with Bitcoin
There are limits when it comes to using cryptocurrencies like Bitcoin in CBI programs. Katz says using this cryptocurrency directly to invest in a country to get a second passport is not feasible.
“Bitcoin is not recognized as the official currency in any of the countries that offer citizenship by investment programs,” says Katz.
He says these countries cannot directly accept bitcoins as a form of investment, but rather a conversion to FIAT currency is a prerequisite.
“Officially, only Vanuatu and Antigua and Barbuda, but regulations can change as the programs are often reviewed,” says Casaburi. “In some countries, the government or developer might accept transactions in FIAT funds, which can be done by trustworthy escrow agents or exchangers.”
Who are the CBI crypto investors and why are they interested in visas?
According to the Henley & Partners' Crypto Wealth Report, there are 88,200 crypto millionaires, of which 182 are crypto centi-millionaires, meaning high-net-worth individuals (HNWI) with crypto holdings exceeding $100 million.
Many of these crypto investors are seeking RCBI programs as a “Plan B” because of the freedom of travel and perks that come with a second passport.
“The profile of the investor in citizenship by investment program with cryptocurrency may vary depending on the country and the program, but generally, they are looking for a safe exit in case things go wrong regarding crypto regulations in their country of origin,” says Casaburi. “They are also active traders who seek to optimize taxes and diversify assets with other investments.”
Meanwhile, Katz says those who have generated profits within the cryptocurrency industry are based worldwide. This includes numerous Americans who have realized gains from cryptocurrencies and seek to “diversify their investments beyond the cryptocurrency realm, which includes pursuing alternative citizenship options.”
He adds his firm has witnessed a substantial surge in demand for CBI programs among North Americans that have gained wealth through cryptocurrencies.
“However, this trend is noticeable among individuals from various other nations worldwide as well,” says Katz.
The Crypto Wealth Report states that these individuals’ interest for crypto-friendly RCBI programs has increased in the past six months, due to increasing bans on crypto trading and aggressive fiscal policies taxing digital assets at their source.
Singapore, Switzerland, and the UAE rank as the top jurisdictions with the most favorable crypto-friendly RCBI programs worldwide, the report says. All three countries are approaching taxing cryptocurrency-related activities, including transactions, mining, staking rewards, and no capital gains taxes, in a highly efficient manner.
The remaining top 10 territories and countries offering attractive investment migration program options for crypto investors are Hong Kong, the United States, Australia, the United Kingdom, Canada, Malta, and Malaysia.
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