T&T prepares to move crypto sector beyond sandbox

Trinidad and Tobago could tap crypto and other virtual assets to address long-standing challenges in cross-border payments, remittances and capital-market liquidity, as regulators prepare to move the sector from a controlled sandbox to a permanent regulatory framework.

Alexander Gafoor, president of the Fintech Association of Trinidad and Tobago, said the opportunity extends beyond cryptocurrency trading to remittances, cross-border payments, stablecoins and the tokenisation of real-world assets.

Gafoor made the comments during a panel discussion on virtual asset service providers (VASPs) at the Central Bank of Trinidad and Tobago’s Research Review Seminar 2026 on September 10. The seminar was themed “Operating in a Fractured World: Economic Resilience, Innovation and Sustainability.”

Gafoor said one of the biggest misconceptions about the sector was that it revolved primarily around buying and selling Bitcoin.

He identified remittances and cross-border payments, along with the tokenisation of real-world assets, as two areas with significant potential.

Crypto payments

The potential for crypto-based payments is particularly relevant to the Caribbean, he said, given foreign exchange constraints and the continued erosion of correspondent banking relationships.

“We all know T&T and the Caribbean in general has certain forex issues,” Gafoor said. “In relation to remittances and cross-border payments specifically, over 60% of crypto users in Latin America are already using digital assets for remittances. So, this demonstrates that it is possible to fill this need.”

He said digital assets could provide an alternative means of moving money across borders as traditional banking channels become more difficult and expensive.

Gafoor also pointed to virtual-asset payment platforms as another possible alternative to traditional banking channels.

“So we need another avenue through which we can run these banking rails,” he said. “Virtual-asset payment queries, with particular reference to stake points, are a practical alternative.”

Tokenisation

Tokenisation could also create opportunities for T&T, particularly because of the relatively small and illiquid nature of the local capital market.

“Relative to tokenisation for a small, illiquid capital market, such as ours, tokenisation of real estate, government securities, or other hard assets could meaningfully improve access and mobility,” Gafoor said.

He pointed to developments elsewhere in the Caribbean as evidence that crypto and blockchain technology were moving beyond speculative trading.

“The Cayman Islands are already seeing tokenised investment funds in its vast framework,” he said. “So, there’s no reason that T&T can’t do the same over time.”

Finding T&T’s niche

However, Gafoor said T&T should not necessarily seek to compete with established financial centres such as Cayman and Bermuda on transaction volumes.

Instead, he said, the country could position itself as a compliance-credible, English-speaking and Financial Action Task Force-compliant jurisdiction.

“The Bahamas has a population of 400,000. Bermuda has a population of 64,000. Cayman has a population of 85,000. All of these jurisdictions have figured out how to make that size a competitive advantage. And I think T&T is in a position to do the same thing,” he said.

Gafoor acknowledged the risks associated with crypto, but said they were not unique to virtual assets.

“There is an inherent risk, of course, in the grey area that is being exploited by bad actors,” he said. “But this happens with cash schemes, USD trading desks. It’s not a problem specific to crypto, even though there are unique and different channels through which these exploitations are happening.”

He said a credible list of regulated VASPs could help consumers distinguish legitimate operators from bad actors.

Such a list, he said, could strengthen public confidence in the sector and provide a foundation for its growth.

Gafoor also said compliance would be critical to the sustainable development of the industry.

“These salient elements of compliance are what is going to stitch the industry together. It’s what is going to separate the bad actors from the good actors. To me, it’s what is going to make the industry sustainable,” he said.

Expertise needed

He said T&T also had work to do in developing the expertise needed to support the sector.

“Most Caribbean nations and small island developing states have the issue of competency development,” Gafoor said. “So, this is something that has to be nurtured, has to be developed over time.”

He said developing local expertise would allow the public and private sectors to grow together rather than relying heavily on external talent.

On the country’s readiness, Gafoor was cautiously optimistic.

“I think we have a bit of work to do, but we’re definitely on the right track in terms of working with the right consultants, working on the right facets of the framework, et cetera,” he said.

He said the eventual test would be whether legitimate crypto and fintech businesses could operate without unnecessary barriers.

“The main thing that we would want to bring up is viability in terms of business modelling,” Gafoor said. “So: how easy is it to function as a fintech? Are there substantial barriers to operation? And that’s why we’re so happy to be at the table at being part of the review of the legislation.”

Regulatory transition

Meanwhile, Kester Guy, chief executive officer of the Trinidad and Tobago Securities and Exchange Commission (TTSEC), said the country’s crypto sandbox was approaching a critical transition point, with its current limitation due to expire at the end of this year.

Guy said regulators had used the sandbox period to monitor participating entities, provide guidance and assess how the sector should be regulated beyond the sandbox.

The intention, he said, is to move from the controlled environment to a broader regulatory structure.

“Once we are satisfied and we move to a more appropriate framework, then a holistic regulatory framework will be considered,” Guy said.

He said the policy position had been developed and circulated among key stakeholders for review and comment.

Guy stressed that the TTSEC was not developing the permanent framework in isolation.

He said the regulator was consulting with key agencies and stakeholders to ensure that the framework was developed in a coordinated manner.

The eventual framework, Guy said, would also need to recognise that not all VASPs perform the same functions.

Blurring of financial categories

He said one of the challenges created by crypto innovation was the blurring of traditional financial categories.

“Part of the reality of innovation is that the lines become blurred as we go forward,” Guy said.

As a result, regulators must look beyond what a crypto company calls itself and focus on the activities it actually performs.

“These entities morph with time, and so there is all the more need for robust consultation and collaboration with all the regulators,” he said. “We peer beyond just the nomenclature to understand the activity. Activity is critical.”

Guy said this approach was important because T&T would ultimately have to demonstrate to international assessors that its crypto framework was not only written into legislation but effectively implemented.

“We just came out from the FATF review, the on-site examination. And we have a long road ahead,” he said. “When these assessors are coming, they’re looking at what has Trinidad done.”

He warned that weaknesses in crypto regulation could have implications beyond VASPs and spill over into the wider financial system.

“They’re not just looking at what we say. They are also looking at practical implementation or how effective what we have implemented has actually been,” Guy said.

Guy said regulators were therefore working on a coordinated approach involving key agencies and the private sector.

The entities involved include the Central Bank of Trinidad and Tobago, Financial Intelligence Unit, TTSEC, Fintech Association and the Attorney General’s Office, among others.

He said a steering committee was being developed to examine the observations from the regulatory process and ensure that the country’s approach was evidence-based.

“We’re constructing with purpose, we are constructing with clarity, and we are constructing with an evidence-based approach,” Guy said.

The objective, Guy said, was to establish a permanent framework that could accommodate innovation while ensuring businesses were subject to appropriate regulatory requirements.

He added that collaboration among regulators would become increasingly important as crypto businesses continue to move across traditional financial categories.