There is no best jurisdiction for a digital asset business. There are only jurisdictions that answer a particular set of questions in a way that suits a particular business model, and jurisdictions that do not answer them at all. What follows is not a league table. It is the list of questions we would put to any centre on a founder's behalf, then the answers for the Gelephu Mindfulness City Special Administrative Region.
In short
- Eight questions decide a crypto jurisdiction: named activities in primary law, one regulator or several, banking, substance cost, tax and whether it sunsets, migration, and knowable case law.
- In GMC, virtual assets are named in the primary financial services statute. Operating a trading facility on which virtual assets are traded, and safeguarding virtual assets, are specified activities on the face of the Financial Services Act 2025.
- One regulator supervises financial services and virtual assets: the Gelephu Financial Services Office. Corporate registration runs separately through the Gelephu Corporate Registration Office.
- The headline company rate under the Income Tax Act 2025 is 15%. The zero rate media reports describe exists only by approval, for limited classes of company, and cannot be granted after 31 December 2030.
- Real licensing activity is on the record: a Financial Services Licence to Matrixport in September 2025, a fast-track announced in May 2026, and BTSE Bhutan's in-principle approval in May 2026.
- On case law, GMC courts can rely on common law precedents from any common law jurisdiction, so parties have a settled body of authority from the day the jurisdiction opened.
Question one: is the activity named in primary legislation, or squeezed into an old securities law?
This question distinguishes the regimes from one another. In many centres, a crypto exchange is regulated because a regulator has taken the view that tokens are securities, or that an exchange is a market operator by analogy. That is workable until it is litigated, and it makes perimeter advice expensive and provisional.
GMC took the other route. The Financial Services Act 2025 names virtual assets in the operative text of the regulated activities themselves. Operating a multilateral trading facility covers a facility on which financial instruments, virtual assets or spot commodities are traded. Custody covers safeguarding those same assets for another. Issuing a fiat-referenced token is its own specified activity rather than a species of deposit taking. So when a GMC lawyer tells you whether your model is inside or outside the perimeter, the answer comes from statutory language about virtual assets, not from an argument by analogy to shares.
Question two: one regulator, or several?
Where a payments authority, a securities commission and a separate virtual asset body each have a claim on part of an exchange, the founder pays for three sets of counsel and three supervisory relationships.
In GMC the Gelephu Financial Services Office is the regulator of all financial services and virtual assets activities. Virtual asset firms are licensed under the same framework as everyone else, with virtual asset guidance layered on top, and the same rulebooks apply: the general rulebook, conduct of business, anti-money laundering and sanctions, market infrastructure, prudential and the fund rules. Company formation and corporate filings sit with the Gelephu Corporate Registration Office, a registry rather than a second financial regulator. That is two front doors, not five, and the May 2026 fast-track was described as combining incorporation, regulatory approval and corporate banking in one route.
Question three: can you get a bank account?
Most crypto jurisdiction failures are banking failures. A licence that no bank will serve is a certificate, not a business.
GMC's answer is unusually concrete for a new centre. Reporting on the May 2026 fast-track described corporate accounts with DK Bank as part of the pathway, spanning nine currencies including US dollars, sterling, euro and the ngultrum, with fiat to crypto rails and bitcoin-backed lending, and banking fees waived for an initial period then discounted. DK Bank was also described as the custodian for the gold-backed TER token launched in December 2025 and as Bhutan's first licensed digital bank.
Question four: what does substance cost?
Substance is now priced into every counterparty's diligence. The question is not whether a jurisdiction demands it but whether its demands are clear enough to budget.
GMC's requirements are set out in the statute. Every company must have at least one director ordinarily resident in GMC, which the Companies Act 2025 satisfies through residence or a valid work visa or work pass. Every company must have a registered office in GMC from incorporation; the registry has confirmed the earlier waiver ended on 30 April 2026 and that the address must be filed within one month and be accessible during stated hours. Every company must have a secretary who is a natural person resident in GMC, subject to the Registrar's power to waive. An auditor must be appointed within three months. Accounts follow international financial reporting standards. Registers of registrable controllers, nominee directors and nominee shareholders must be maintained.
For a licensed firm there is more. The general rulebook requires a body corporate incorporated in GMC to have both its head office and its registered office in GMC, and the regulator assesses head office by reference to where directors and senior management sit and where day to day operational and control arrangements are run. A firm that fails on that point alone will not be considered fit and proper. Mandatory appointments include a senior executive officer, a compliance officer and a money laundering reporting officer, all resident in GMC or Bhutan, with a case by case waiver possible for the latter two.
That is a real cost, and it is also the point. A jurisdiction that asks for nothing produces a company that banks and exchanges will not deal with.
Question five: what is the tax position, and does it sunset?
Ask two things: the headline rate, and the expiry date on any concession.
The Income Tax Act 2025 charges companies and bodies of persons at 15% on every dollar of chargeable income, and non-resident persons other than individuals at the same rate. Individuals who are not Bhutanese citizens are charged at 0% on chargeable income derived on or before 31 December 2030.
The widely repeated claim that GMC offers 0% corporate tax for priority sectors is not what the statute says. What exists is an exemption for an approved founders company carrying on a qualifying business in an approved founders industry, where the total exemption period including extensions cannot exceed fifteen years, and a concessionary rate of not less than 5% for an approved strategic and development company, with the relief period set in the approval. Both are approvals, not entitlements, and neither may be approved after 31 December 2030. Further reliefs, including provisions aimed at treasury centres, debt securities and fund structures, are also on the statute book.
So the correct framing is this: GMC is a 15% jurisdiction with a defined approval route to a lower rate, and a window that closes at the end of 2030. That is a better foundation for a ten year plan than a slogan is.
Question six: can you migrate an existing company in?
Founders rarely start from nothing. A company already exists, with a cap table, contracts and a licence application history.
The Companies Act 2025 contains a transfer of registration regime allowing a foreign corporate entity to be registered as a GMC company limited by shares, preserving the entity rather than requiring a new incorporation and an asset transfer. The Income Tax Act 2025 contains its own modifications for redomiciled companies and a tax credit mechanism where they are approved. The practical constraint is the outbound side: migration only works if your current jurisdiction permits a company to leave, which is a question for counsel where the company sits today.
Question seven: is the case law knowable?
GMC took a distinct approach here.
Rather than write a private law system from scratch, the Application of Laws Act 2024 applies the received common law and equity of established common law jurisdictions, so far as suited to GMC circumstances and subject to GMC enactments. A schedule of named applied statutes applies with modifications, covering matters such as third party contract rights, electronic transactions, insolvency and restructuring, personal data protection and stamp duties. A second schedule applies financial services rulebooks modelled on those of an established international financial centre, with regulator references read as GMC's own. The applied general law is presumptive in civil and commercial matters and prevails over the applied financial services rules in a conflict unless GMCA decides otherwise.
A GMC contract dispute is therefore argued using a body of authority that a commercial litigator in Asia already knows. GMC courts can draw on the precedents of every common law jurisdiction, so parties have a settled body of case law from the day the jurisdiction opened.
Question eight: what has been licensed and built so far?
Paper regimes are common in this sector. The record is set out below with dates and names. Matrixport received a Financial Services Licence from GMCA on 26 September 2025 and said it would establish a GMC office. In December 2025 a gold-backed token called TER launched on Solana under a GMC framework with custody at DK Bank, and GMCA appointed Matrixport's tokenisation arm as key technology provider. Also in December 2025, Bhutan pledged up to 10,000 bitcoin from national reserves, described as roughly one billion US dollars, to support GMC's development. In May 2026 GMC announced the fast-track and BTSE Bhutan received in-principle approval for two activities. In July 2026 the digital asset investment manager 3iQ Corp announced a partnership under which it will manage a mandate backed by a portion of GMC's bitcoin reserves and establish a long-term presence in Gelephu.
One correction is due on the fast-track. This is not passporting in the European sense. GMC was explicit that firms must still comply with its own regulatory standards and supervision, and that a foreign licence simplifies due diligence without substituting for local review.
Frequently asked questions
Does a Singapore, Abu Dhabi Global Market or Hong Kong licence carry over into GMC?
No. The May 2026 fast-track gives firms already licensed in those centres an accelerated review. GMC stated expressly that firms must still meet its own standards and supervision.
Which regulator licenses a crypto exchange in GMC?
The Gelephu Financial Services Office, which regulates all financial services and virtual assets activities in GMC under the Financial Services Act 2025 and the rulebooks published under it.
Can I move my existing offshore company into GMC?
The Companies Act 2025 provides a transfer of registration route for foreign corporate entities. Whether you can leave your current jurisdiction is a question of that jurisdiction's law.
Has any exchange been approved?
BTSE Bhutan received in-principle approval from the regulator in May 2026 for operating a multilateral trading facility for virtual assets and for institutional-grade custody. It was in principle and conditional on satisfying pre-conditions before operating.
The bottom line
Judge GMC against the eight questions rather than against a headline. It scores well on the first two, because virtual assets are named in primary legislation and a single regulator supervises them. It scores unusually well on banking for a centre of its age, and its substance requirements are specific enough to price. Its tax position is a real 15% with an approval-gated and date-limited route below that, which is more attractive than most founders think once they stop believing the zero tax claim. On precedent, its courts can rely on common law precedents from any common law jurisdiction. Basnet Law is the first incorporated law firm in GMC and advises international clients on exactly this comparison.
This article is general information about the law of the Gelephu Mindfulness City Special Administrative Region as at the date above. It is not legal advice and does not create a lawyer-client relationship.
You may contact Basnet Law at basnet@basnetgmc.com or office@basnetgmc.com for any legal queries related to GMC.
Sources
- Acts: Financial Services Act 2025 (Law No. 5 of 2025), Schedule 1 Part 2 paras 4, 12, 43, 46, 52, 53B, 54 and para 55 exclusion; Companies Act 2025 (Law No. 1 of 2025), ss. 142, 143, 145, 171, Part 10A ss. 355-364A; Income Tax Act 2025 (Law No. 6 of 2025), ss. 1(3), 13Y, 34G, 34H, 43(1)(a), 43(1)(ba), 43D; Application of Laws Act 2024 (Law No. 1 of 2024), ss. 3, 4, 5, 7, Schedules A and B; GEN Rulebook 2026, 4.5, 5.5; Royal Charter No. 1 of 2024
- GCRO FAQ for GMCA Entities, version 0.2, 3 June 2026
