OBA: Questions About Recent FinTech MOUs

June 12, 2018 | 40 Comments

[Updated] “A succession of MOUs with cryptocurrency firms is starting to sound like the promises made by the PLP during the failed ‘platinum period’ when plans for new hotels failed to materialize,” the One Bermuda Alliance said today, adding they they will support initiatives designed to increase opportunities “but we need more details other than the vague promises made in a series of MOUs.”

This follows after the Government recently signed a number of MOUs with FinTech firms, including Binance, Omega One, Shyft Network and Medici Ventures.

“Government has signed a raft of MOUs – memorandums of understanding which are non-binding – with companies amid promises of investment in jobs and training,” the OBA said.

Shadow National Security Minister Michael Dunkley said that “the terms of each MOU were non-specific, non-binding and never stated what a minimum requirement was.”

He also said there “appeared to be discrepancies between public announcements and the terms of some of the MOUs. In addition one MOU almost mirrors an MOU recently announced in another jurisdiction.”

Mr Dunkley said, “The OBA is a party of empowerment and diversity, so we would naturally welcome any initiative that creates new opportunities for our fellow Bermudians, however more detail on these MOU’s needs to be provided and more assurances that this industry is here to stay before we can give it our full backing.”

“At the moment it resembles the previous platinum period when the PLP Government granted special development orders left right and centre and promised new hotels only for nothing to materialize.

“Cryptocurrency has created a buzz in some areas but we should not forget that over 80% of initial coin offerings [ICO] are scams and that 92% fail to reach the trading stage. This does not say that there isn’t potential business for Bermuda; but the hype has outpaced substantive sober discussion.”

Mr. Dunkley said the Premier tweeted about Arbitrade after a presentation in May, ‘the team demonstrated their cryptocurrency platform and explained plans to create more job opportunities in Bermuda for Bermudians’.

“But in a lengthy statement, Arbitrade, when it announced it would domicile in Bermuda, made no mention of any jobs being created. We hope that was an oversight and it would be helpful if that can be clarified,” said the former Premier.

He also pointed to the details of an MOU with Binance which states that it will “create at least forty [40] jobs in Bermuda”.

“When this was originally announced by the Premier he said in a statement that Binance would ‘develop its global compliance base in Bermuda, creating at least forty [40] jobs in Bermuda, with at least 30 jobs for Bermudians,” he said.

“We hope that the omission in the MOU about the jobs for Bermudians is another oversight and can also be clarified,” said Mr. Dunkley. “If there are no jobs for Bermudians, we would have to question the PLP stated position of putting Bermudians first.”

He added that “the MOU with Medici Ventures promised the creation of 30 jobs over three years, but failed to say who these jobs were for, or at what level. The announcement of an MOU involving B-Seed Partners, FinHigh Capital and B.F.S. Holdings as partners in a new Bermuda venture, Bermuda FinTech Accelerator spoke only vaguely about the creation of jobs.”

Mr. Dunkley said shortly after announcing the MOU with Medici the Premier also announced an agreement with Bitt.com and Gabriel Abed for free consultancy but never mentioned that Medici has invested $7 million dollars in Bitt.

“No agreement has been tabled with Bitt.com. In life nothing is free and one must ponder if the relationship between Medici and Bitt.com allows them to agree to a “no cost” consultancy or is Bermuda really “another world”?”

“The MOU with Omega One states that the firm will ‘provide favourable consideration of Bermuda residents and Bermuda-based businesses as part of internal employment and onboarding policies and procedures, with the expectation of adding 20 local jobs in Bermuda over three years’. That is hardly a resounding commitment to employing Bermudians.”

Mr. Dunkley added: “What all the MOUs have in common are vague references to something – up to $10m in training, or a ‘potential investment’ of up to $10m. What they also have in common is no apparent minimum requirement, whether in terms of investment or jobs.

“There are many questions that need to be answered: When can the people of Bermuda expect to see signed contracts?

“When can the people of Bermuda expect the new jobs promised? What immigration fast tracking has been agreed to, what number of permits are permitted and can Government assure the people of Bermuda that this new industry is sustainable?”

“Many people will remember the DotCom crash when so many companies went bust. Can we be sure that this is not going to happen in the field of cryptocurrency?”

“As I stated, the OBA is a party of hope and opportunity and we will support initiatives that are designed to do that, but we need more details other than the vague promises made in a series of MOU’s.”

Update 6.30pm: Premier David Burt said, “Global companies have global strategies. The execution of an MOU between Binance and Jersey is consistent with Binance’s stated goals of positioning the company on the global stage. As Binance said: ‘We have chosen Jersey to be the next big step in our global expansion strategy.’

“The important thing for Bermuda is that we were the first; others are following our lead. The Government of Bermuda continues to work with them to ensure that the undertakings set out in the MOU signed with the Government of Bermuda are fulfilled.

“Bermuda’s lead may well be followed by other jurisdictions and this makes it all the more important for us to continue to provide the sound regulatory and compliance framework in place to stay at the head of these global developments.

“Having failed to diversify Bermuda’s economy or create opportunities for Bermudians, it is sad to witness the dated criticisms of a former Premier, whose policies and stewardship were soundly rejected in 2017.

“Rather than add to the understanding of the people and encourage the economic diversification every expert says is necessary for Bermuda’s growth, we instead are treated to a pedantic dissection of MOUs which are already being replicated in other jurisdictions, following Bermuda’s lead.

“There is a process to be followed in developing another pillar of Bermuda’s economy and we will not be distracted by naysayers, out of ideas and who refuse to see the potential for growth and economic expansion for the people of Bermuda.

“Globally, the FinTech industry is accepted as the fastest growing trend of technology-led economic development and this Government is determined to have Bermuda lead in this space. Bermudians can, and will benefit, from our diligence and these opportunities are being created to lift up those people left out by the former OBA Government.”

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Comments (40)

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  1. puzzled says:

    Good points Michael.
    And valid.
    You will catch hell for it but at least for now we have a milk moustache

    • What says:

      Michael is full of crap! He knows absolutely nothing about technology and yet tries to spit out statistics that are erroneous and not true! Stick to delivering milk or sugar products and let Bermudians like me who need a solid job in IT to move ahead. It’s not about you Michael!

      • redrose says:

        In fairness to Mr Dunkley he says quite clearly that he supports anything that offers opportunities but he is doing his job and asking the pertinent questions, one of which is about the number of job opportunities for Bermudians

        • False Promise says:

          What about the PLP’s false promise that $24MM would be invested into the Grand Atlantic?? The PLP’s promise was that construction would launch on May 2018. Well, we are in June and NOTHING is going on there. We are slowly beginning to see that the PLP cannot deliver…all smoke & mirrors!!

      • LOL says:

        Since you obviously know it all, why don’t you explain the technology along with any misinformation Mr. Dunkley stated?

        • Redrose says:

          I am not sure where it says I know it all, I just stated that Mr. Dunkley is asking pertinent questions about jobs. I, for one, hope new jobs are created and future opportunities arise as well

      • Angus says:

        Michael’s questions and comments are very sound and valid.

        As it relates to the technology jobs being created none of the MOUs point to tech jobs, and none of the companies will add tech jobs in Bermuda. Compliance jobs definitively – so the only real winner in this will be the BMA who already have highly paid staff and are looking for fintech experts – which will not likely be Bermudians to add to their compliment of staff.

        The questions Michael missed are why are there no home grown (Bermudian) startup companies in this list? Does Bermuda not have anyone who knows tech? Does the Premier not have confidence in his fellow Bermudians in technology? When will there be opportunities for Bermudians to get in on new industries as owners rather than employees?

        The only owner opportunity for Bermudians recently has been with the AirBnb rentals, which just took a disproportionate hit against the establishment of hotels – so in my opinion Bermudians being squeezed out of ownership and into jobs/employment. Hardly Bermudians first in my opinion, but maybe we are not all that intelligent and cannot see the grand plan that the Preimier has set out. Really hoping for the best but sceptical right now.

      • Anbu says:

        You even qualified for a position in IT? Too many idiots out there who are in the IT industry who have zero clue how to even get someones email up and running, yet theyre making loot doing absolutely nothing. Having electonic retail store workers doing their jobs for them. And they are supposed “qualified” Bermudians. And the majority of them from my experience having to answer basic questions that an entry level technician should know, are in gov positions. My coworkers and i deal with at least 6 to 10 of them daily. Hope your creds are up to scratch unless youre gonna work for gov. Surprise surprise……

    • Bitcoin says:

      Mr. Dunkley is like a puppet! He has no knowledge of the topic he speaks about yet is trying to advise us on it? Unless he is going to develop a Blockchain application around milk he needs to shut up and let the smart people in Bermuda take the lead!

      Jeanne Atherden is even more techno illiterate than Mr. Dunkley so no wonder she is taking a back seat!

      Michael just spews our what Fahd and his other entitled cronies tell him to say. If you ever got Michael in his own he would look real stupid without his notes!

      • redrose says:

        As I suggested above – Dunkley is, correctly, trying to establish what, exactly, the facts are and, quite clearly states that he/the OBA support things that provide opportunities for Bermudians.

        • Bitcoin says:

          Michael is making people fear change and using that fear as his campaign for not moving forward. Classic politics 101 which I hope Bermudians will see through it. We have to accept that change is needed and that we have an opportunity to set the standard versus be defined by someone else. In order to create jobs we need to establish the industry so all these negative “where are the jobs” statements are premature as without the industry there will be none!

          So all Bermudians need to get behind the PLP and help get this over the goal line and stop listening to people like Michael Dunkley who knows nothing about this industry.

          • wahoo juice says:

            “Cryptocurrency has created a buzz in some areas but we should not forget that over 80% of initial coin offerings [ICO] are scams and that 92% fail to reach the trading stage. This does not say that there isn’t potential business for Bermuda; but the hype has outpaced substantive sober discussion.”

            “sober discussion” being a plp devotee I guess you are not familiar with the notion of taking your time and gathering facts.

      • LOL says:

        With a name like Bitcoin, you must be pretty smart. Why don’t you explain the technology along with any misinformation Mr. Dunkley stated?

        • Ringmaster says:

          Bitcoin probably cannot even spell Bitcoin, let alone know what it is. Jobs in these areas are mostly mundane, pay less than a Bermudian wants but need skill sets that are alien to Bermudians. These are IB jobs and will be filled by expats. So much for Bermuda for Bermudians.

          • redrose says:

            Bitcoin probably still lives with his Mommy

            • Bitcoin says:

              Leave my mother out of this or you gonna feel the pain!

            • Redrosr says:

              Let me apologize for my comment. That was not fair and has nothing to do with this. My poor attempt at humor and I ask for your forgiveness! I know many people who live at home for many reasons and so I am sorry.

              • redrose says:

                Thank you for your impersonation, I do not apologise one bit however.

      • Anbu says:

        And burt knows all about crypto and its inner workings…….. RRRIIIIIIGGGHHHHHTTTT!!!! Cut them stings ur starting to look like pinochio

  2. WSP says:

    Come on Bitcoin Dave fill us in.We are awaiting the news of a third pillar of our economy.
    PLP with “Trickle down economics” thought I would never hear that from them,ironic .

  3. I agree, like we needed more details on de airport.

    • Joe Bloggs says:

      Yes, curious that. The PLP government has been in power for nearly 1 year now and still no detail on the airport deal. What happened to the promise of killing the airport deal and providing us with details?

      • Hmmmm says:

        Joe, The PLP paid for a report on the airport.. Didn’t like what it said so put it in the closet…

      • wahoo juice says:

        They found out what a contract means. Unfortunately the learning curve is still very steep for them but they got the majority of the people convinced that sometime between 2022 and 2025 something amazing will happen….’til then we just stand strong.

  4. bronwen says:

    And look at this from Digital jersey today. Spot the similarities?

    Digital Jersey has signed a memorandum of understanding with the world’s largest cryptocurrency exchange, Binance. Under the memorandum, Binance will develop a compliance base and cryptocurrency exchange in Jersey. Digital Jersey will collaborate with Binance to deliver training and other initiatives to support the growing blockchain ecosystem in Jersey. Digital Jersey will also support Binance in discussions on compliance with anti-money-laundering regulations, and to establish exchange licensing and local banking relationships.
    CEO of Digital Jersey, Tony Moretta, said, “Jersey was one of the first countries in the world to clarify the legal position of cryptocurrency exchanges back in 2015. We can provide a permissive sandbox for innovative crypto businesses to thrive without moving away from the general high standards of regulation that apply in our jurisdiction. We look forward to collaborating with Binance to develop their exchange and compliance function in Jersey, deliver blockchain training as part of our digital skills programme and support the growth of new start-ups in this area.”
    Binance selected Jersey for its highly developed digital infrastructure, robust regulatory framework, and world class financial services sector. The Government of Jersey and the Jersey Financial Services Commission recognise the innovative potential of distributed ledger technology and will work closely with Digital Jersey to develop this area of fintech and the growth of local talent to support it.
    CEO of Binance, Changpeng Zhao, said, “We have chosen Jersey to be the next big step in our global expansion strategy for its clear and pro-crypto investment and regulatory environment. With its local economy based on a major currency (GBP), and its close proximity to the UK and Western Europe, we are confident the cooperation with Jersey will not only benefit the local economy, but also form a strong operational foundation for our expansion into the rest of Europe.”
    It is hoped that the move will create around 40 new jobs in the sector and Digital Jersey are working with the Binance Foundation to establish training schemes covering a range of digital skills including distributed ledger technology, artificial intelligence and regulatory compliance. Binance will also invest in new Jersey-based start-ups in this area through Binance Labs, encouraging innovation and supporting Digital Jersey’s objective to diversify the Island’s economy and establish Jersey as a leading digital centre.

  5. Phishes says:

    MOUs are handwaving puffery.

  6. Alan says:

    Dunkley’s various points have validity in-so-far-as he points out the risks inherent to any new business let alone new industry – which are that sure things do not exist and failure is always a possibility. This does not mean that we should not try and support these ventures, which seems to be what his reasoning is implying. Indeed, if this were the case, would we ever have had a tourist industry let alone an IB sector? Let’s hope for everybody’s sake that these very speculative ventures succeed! Thank You Mr. Premier and Minister Caines for these efforts to promote industry.

    That said, something better succeed and fast because we are still living on borrowed money and time. Much of the private sector is only being kept from collapse by Government spending the money it borrows – against all our futures. Thousands of private citizens (my observation from the front lines) are living off their life savings and cashing in assets to stay afloat. Thousands more have left as they simply cannot afford to stay and economic activity correspondingly shrinks. There clearly is no easy solution (like say an America’s Cup…ha ,ha ,ha), only hard choices and hard work.

  7. Serious Though says:

    Because The UBP/OBA Boys club are not part of deal, and they want in on the deal, They have sent the milk man with talking points..just to shake up some information…laughable tactics

    • Anbu says:

      Again. Pot meet kettle. Sounds like aceon and the plp to me. Youre the one with “laughable tactics”

  8. Ringmaster says:

    Michael Dunkley who is the Shadow Minister behind Minister Caines is correct. The MOU’s have no substance behind them. Vague promises but at least the cost to play is shown. Not that that will ever be paid, at least publicly. Charlie Munger who is Warren Buffett’s next in line called these types of firms “trading turds”. It will create no jobs for Bermudians, but it makes Premier Burt look good to the voter base. Lots of activity but no results. Construction creates jobs for Bermudians but the PLP tried to stop the OBA every time. Technology opportunities are way beyond the capability of most locals thanks to the public school system.

  9. Harold says:

    It is interesting that the premier’s statement fails to answer virtually all of dunkley’s points especially related to jobs and relies on criticizing the messenger while ignoring the message

  10. cpm says:

    What about Jersey?

  11. redrose says:

    No, sorry premier, you have engaged in unnecessary mud slinging here instead of specifically answering all the points, especially the ones on the jobs you promised which, according to the details of the MOUs, are not going to materialize the way you have promised.
    Not a good come-back, you obviously have nothing else to say, very disappointing indeed but maybe this is the reality after all?

  12. Martigne says:

    Not sure if this is quite the right place to make this observation but hopefully Madame Editor will appreciate its relevance:

    There I am driving my son to work this morning, 9.10 am, just after Arboretum / Deputy Governor’s house on Middle Rd, when I spot coming from the other direction a Dunkley’s mini van with the (black haired, caucasian)driver busy talking on the phone. Perhaps not such a big deal, except that there seems to maybe be something of a culture of recklessness and turning a blind eye. The very sad fatal collision of course comes to mind.

    Here are my two points -

    Dunkley might consider keeping quiet for a while and putting his own house in order. This culture of good old boy, looking the other way callousness is harmful, even lethal.

    The vast majority of us are not born into nor inherit a monopoly, let alone a milk one. Nor do we come into significant holdings of residential and commercial properties generating tens of thousands of dollars in earnings every month, year in and year out. Taking this privilege for granted and shirking one’s responsibilities on the small things is a sign (at least to me) of arrogance and indifference to the less well off.

    Conclusion: Former Premier Dunkley would do well to wish all aspiring entrepreneurs well and reflect upon his own good fortune.

  13. Me says:

    In all this nonsense nobody will ask about Bermudas debt and and how much is added to it since the block party

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