Have you ever wondered how major international FinTech companies such as Tether or Binance are structured? In the public eye, people usually see only their brands. From a legal standpoint, however, these businesses operate as financial technology holding companies that bring together a large number of separate legal entities, each responsible for a specific area of operations. Many of these companies are incorporated in jurisdictions whose names may sound unfamiliar or even exotic. CP Media takes a closer look at why they choose these jurisdictions and what makes them attractive.
Holding Jurisdiction vs. Licensed Operating Company: What’s the Difference?
It’s important to distinguish between holding structures and operating companies. The former serve as parent companies that manage capital, intellectual property, and overall corporate strategy. The latter function as regional or specialized entities that handle day-to-day operations, such as payment processing or the custody of client assets.
The structure typically looks like this:
- Parent company provides strategic oversight and centralizes corporate governance
- Subsidiary obtains the required license or authorization from the local regulator
- Licensed subsidiary delivers services directly to clients and enters into contractual relationships with them
- When expanding into new markets, the holding company establishes a new licensed legal entity without restructuring the broader corporate group
This model is particularly common among groups that operate under multiple regulatory regimes while providing settlement infrastructure, digital asset services, brokerage, payment services, and other financial products across different jurisdictions.
Deriv, one of the world’s largest online brokers, offers a clear example. Its holding company is incorporated in the Crown Dependency of Guernsey, while its regulated entities operate across roughly 15 jurisdictions worldwide.
Another example is eToro. The cryptocurrency exchange’s parent company is incorporated in the British Virgin Islands, while the brand serves different markets through a complex network of local entities, each licensed by the relevant regulator.
Offshore and Quasi-Offshore Jurisdictions: What Are They?
According to various estimates, as of 2026, there are about 40 traditional offshore jurisdictions worldwide, along with roughly 20 quasi-offshore jurisdictions that offer selected elements of preferential tax and corporate regulation. The exact number depends on the methodology and classification criteria applied. For example, the European Commission identifies 40 offshore jurisdictions, while CORPNET, a research group at the University of Amsterdam, identified 5 conduit offshore jurisdictions and 24 sink offshore jurisdictions.
Offshore jurisdictions are countries or territories that offer favorable tax regimes, a high degree of corporate confidentiality, and simplified requirements for company formation and administration for businesses that conduct most of their operations outside the jurisdiction.
Quasi-offshore jurisdictions aren’t traditional offshore centers, but they offer selected elements of preferential regulation, such as special tax regimes, simplified corporate governance requirements, or favorable conditions for international business while complying with international transparency standards.
Offshore and quasi-offshore jurisdictions allow companies to establish separate legal entities for international operations that serve clients outside specific national legal frameworks. At the same time, they preserve centralized corporate oversight and make it possible to isolate risks across different business lines. That’s why these jurisdictions remain a popular choice for incorporating both parent companies and operating entities within international financial holding groups and global FinTech companies.
Specialized Offshore Licenses for the Virtual Asset Market
Specialized offshore licenses for the virtual asset market occupy a distinct place within the corporate structures of international FinTech groups. Bermuda, the Bahamas, and the Cayman Islands stand out in this category, with each jurisdiction developing its own regulatory framework for the exchange, custody, transfer, and other digital asset activities. For global companies, these licenses serve not only as formal authorization to operate, but also as a way to establish a dedicated regulated framework for their cryptocurrency business while keeping it separate from payment, brokerage, and holding company operations.
Bermuda
Bermuda’s digital asset regulatory framework is one of the most widely used among offshore jurisdictions. The Bermuda Monetary Authority (BMA) issues a comprehensive license covering a broad range of cryptocurrency services, including payment processing, custody, exchange services, and trading activities.
The jurisdiction is particularly popular among leading digital asset companies. Licensed entities include subsidiaries of Circle, Coinbase, Kraken, Gemini, and many others. In total, Bermuda is home to 574 registered and licensed financial institutions, including 50 companies authorized to provide cryptocurrency services.
The Bahamas
The Bahamas also offers a broad regulatory framework that covers digital asset custody, exchanges between digital assets and fiat currencies, crypto-to-crypto trading, money transfers, payment services, and even staking.
The jurisdiction is particularly well suited for companies seeking a standalone international cryptocurrency operation with a transparent regulatory framework and a dedicated operating jurisdiction. The Securities Commission of The Bahamas (SCB) applies relatively stringent licensing requirements, and the jurisdiction hosts licensed entities of OKX, Uphold, Bitfinex, Zodia Markets, and other market participants.
The Cayman Islands
The Cayman Islands are widely used to incorporate investment funds, holding companies, and cryptocurrency businesses. The Cayman Islands Monetary Authority (CIMA) separately regulates Virtual Asset Service Providers (VASPs). Crypto.com’s local subsidiary is among the international companies operating under the jurisdiction’s regulatory framework.
Offshore Licenses for Brokerage and Financial Market Activities
Offshore licenses for brokerage and financial market activities are another tool commonly found in the structures of international financial groups. These regimes are typically used by companies that deal in currency pairs, contracts for difference (CFDs), derivatives, securities, and other market instruments.
For global businesses, such frameworks make it possible to establish a separate operating company for brokerage activities and place it within a clear regulatory framework. This keeps trading operations separate from holding functions and payment infrastructure.
The British Virgin Islands
The British Virgin Islands are often viewed as a traditional holding jurisdiction, but they also have a comprehensive investment regime covering investment business, asset management, advisory services, and transactions involving financial instruments. The British Virgin Islands Financial Services Commission (FSC) issues investment business licenses under the Securities and Investment Business Act (SIBA).
International entities affiliated with eToro, Tiger Brokers, Metalpha, and other companies are incorporated in the jurisdiction. Tether’s main legal entity was also originally incorporated there in 2014 and remained in the British Virgin Islands until the company relocated to El Salvador in January 2025.
Seychelles
Seychelles remains one of the most widely recognized jurisdictions for international brokerage companies. Licenses issued by the Seychelles Financial Services Authority (FSA) cover a broad range of activities, including dealing in securities as either an agent or a principal.
The local regulatory regime is suitable for trading platforms and FX brokers that work with a broad range of assets. Bybit, Alchemy Markets, Capital.com, and several other financial companies use it within their international corporate structures.
Several jurisdictions similar to the Seychelles and the British Virgin Islands also offer incorporation and licensing options for various areas of international financial activity. These include Mauritius, Vanuatu, Belize, and others. All of them are widely used by international financial groups as holding and operating jurisdictions.
Other Licenses Commonly Used by Global FinTech Companies
Other licenses commonly used by global FinTech companies are primarily associated with payment services, electronic wallets, settlement infrastructure, and cross-border transfers. These authorizations often provide the legal foundation for international products, allowing companies to serve clients, process transactions, and manage the movement of funds across borders.
Singapore
Singapore is widely regarded as one of the world’s most advanced jurisdictions for the regulation of FinTech products. The Monetary Authority of Singapore (MAS) issues a broad range of financial licenses. Given the rigor of its regulatory requirements, these licenses are also used to support international operations. The country is home to entities affiliated with many global FinTech companies, including Wise, Stripe, Revolut, Coinbase, Circle, Adyen, and others.
“MAS places significant emphasis on sound governance, effective risk management, and demonstrable outcomes, rather than purely procedural compliance,” Claudia Hui, Head of Compliance at Revolut Singapore, told CoinsPaid Media in an interview.
Hong Kong
Like Singapore, Hong Kong offers a broad range of licensable financial activities and maintains a high regulatory standard. As a result, licenses issued by the Hong Kong Monetary Authority (HKMA) are highly regarded worldwide. The jurisdiction is home to entities affiliated with Alipay, WeChat, PayPal, Wise, and many other international companies.
Singapore and Hong Kong remained among the leading jurisdictions for financial and Web3 technologies in recent years, largely because of their regulatory progress. From a legal standpoint, MAS and HKMA licenses don’t authorize companies to operate in other countries. They do, however, make it significantly easier to engage with local regulators and strengthen the international reputation of the brands that hold them.
Regulatory Architecture of Global FinTech Companies
It’s important to distinguish between incorporation and licensing. The former involves establishing separate legal entities within an international corporate group, while the latter refers to obtaining authorization for those entities to carry out specific regulated activities.
Incorporation makes it possible to:
- Create a legal entity that can enter into contracts, open bank accounts, hire employees, own assets, and conduct business operations.
- Segregate risk across the corporate group, since not every legal entity is required to hold a license and each company can be responsible for a separate function, such as marketing or intellectual property management.
- Use dedicated legal entities for nonregulated functions, including software development, brand management, procurement, or internal services. A license is required only where regulated activities are carried out.
In addition, local entities allow international companies to enter new markets more quickly. In most cases, licensing follows later, once the local team, banking infrastructure, and operational processes are already in place. Incorporation also lays the groundwork for licensing, as regulators typically require applicants to be established in the relevant jurisdiction, maintain a local registered address, appoint local directors, implement compliance processes, and demonstrate a clear corporate governance structure.
Ultimately, the complex corporate structures of global FinTech companies are, in part, a response to the fragmented nature of financial regulation across jurisdictions. In addition, nearly all of the jurisdictions discussed above operate regulatory sandboxes, allowing international companies to test products and services locally within a regulated environment.
As a result, offshore and quasi-offshore licenses shouldn’t be viewed as a universal gateway to global markets. Instead, they form part of a broader corporate strategy. Circle and Coinbase provide clear examples. While both companies are headquartered in the U.S., their subsidiaries are incorporated in many of the jurisdictions discussed in this article, significantly expanding their global operational capabilities.
