Creating a 'Bitcoin Island' just off the English coast

The sales pitch for the island is compelling: with no capital gains tax, potentially no corporation tax and extremely low income tax, entrepreneurs could walk away with large rewards should their company gain traction. And the governments positive stance on Bitcoin provides stability and certainty - it has begun to regulate crypto-currencies, but only enough to provide legal and financial stability, not to squash innovation.

The charming little island, with its established population of high-net-worth individuals, is not without its more tangible attractions: great restaurants, low crime, beautiful scenery. Entrepreneur Mark Shuttleworth, who became the second space tourist in 2002 when he paid $20m for a short stint on the International Space Station, is already a resident. Only the weather is a sticking point.

For many, the Isle of Man is synonymous with motorbike racing

Bitcoin already has a huge number of fans on the island, including in government. Chris Corlett, chief executive of the department of economic development, announced this week that residents could soon be able to pay everything from your car tax to your income tax bill in crypto-currencies like Bitcoin.

There is an evolution here, given what weve learned about digital currencies in the last year, it was a relatively simple decision to take, he said.

At last weeks Crypto Valley conference there was a host of companies ready and waiting to help Bitcoin startups move in, establish bank accounts, buy IT equipment, start accounts and even talk directly to government ministers about potential legislative issues.

One entrepreneur who has already moved to the island told me that there have been occasions when he needed to talk to a minister and got an appointment the same day. That wouldnt happen in the UK, he told me. In a fast-moving, uncharted industry like crypto, thats a huge bonus.

Kurt Roosen, chief executive of Micta, the member organisation for hi-tech firms on the island which steers government on these matters, says that the Isle of Man is pragmatic about Bitcoin business, but realises how important it is to do it right.

"We want to do business but we're not prepared to prostitute ourselves to do it, he told the Telegraph. We'd love to be part of it but it has to be done in a flexible, not gung-ho fashion. There's a lot of money being invested now. We can't really ignore it.

The balance that has been struck is to register it, but with a light touch: "It's a bit of a petulant child that needs some adults - and that's the role that we can play."

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Creating a 'Bitcoin Island' just off the English coast