This inaugural edition of the Conyers Investment Funds Report presents a variety of updates and insights relevant to the investment funds space in the Cayman Islands, British Virgin Islands, and Bermuda. The report provides access to Conyers resources including upcoming filing deadlines, details of key industry events, and recent thought leadership.
Industry Figures
Trending Topics in Investment Funds
Shifting Landscape of Private Equity Fundraising in Asia
A marked shift is taking place in the Asian private equity (PE) and venture capital (VC) fundraising arena. 2024 saw the lowest level of PE and VC fundraising in Asia in 12 years – and a 29% decrease from 2023. Within this context sits a remarkable bubble: deals targeting Japanese companies led to an almost 41% increase in PE and VC-backed investments in the country. Standard & Poors cites Japan’s low interest rates as a key factor in creating investor opportunity, alongside the succession challenges faced by the many family-owned businesses in the country. The Japanese business community is more open to private equity investment than it has ever been. Watch this space for further growth during 2025!
Several factors are contributing to this surge, including the sale of thousands of private family businesses and increased interest from public pension plans and university endowments, two emerging investor classes in this market. Restructurings and de-listings prompted by Tokyo Stock Exchange reforms have also created an active take-private market for PE investors
Sources:
“Private equity investment in Japan soars”, Dylan Thomas, Neel Hiteshbhai Bharucha and Yuzo Yamaguchi, S&P Global Market Intelligence, 28 January 2025
“Asia-focused private equity fundraising hits 12-year low”, Karl Angelo Vidal and Shambhavi Gupta, S&P Market Global Intelligence, 6 February 2025
Private Equity International, “Japan”, April 2025
Digital Assets on the Rise in Cayman
Digital Assets are surging as an asset class of interest for hedge funds. The Global Crypto Hedge Fund Report recently published by the Alternative Investment Management Association (AIMA) and PwC shows that just under 50% of hedge funds surveyed (63% of which are Cayman funds) now have exposure to digital assets – a notable 72% increase from 2023. The report credits increased regulatory clarity and ETFs with the rise of investor confidence. Other key observations from the report include a shift to derivative trading in digital assets, a burgeoning interest in tokenization, and increased demand from institutional investors.
Growth in Cayman Islands Private Funds
The number of Cayman Islands private funds has been steadily growing over the past five years, with an overall increase of 36.2% from 2020 to the end of 2024. This outpaces the growth seen in the Cayman Islands open-ended mutual funds space.
Tokenization of Funds in BVI
The British Virgin Islands has emerged as a leading jurisdiction for offerings of tokens and other virtual assets. Tokenized investments funds offer many advantages, including a balanced regulatory framework, enhanced liquidity and accessibility, increased transparency and security, and cost-effectiveness. The BVI Approved Manager Regime makes the jurisdiction even more attractive, offering regulatory flexibility, technological accommodation, cost-effectiveness, and global reach that enables fund managers to capitalise on the evolving landscape of digital finance.
KEY CONFERENCE TAKEAWAYS
Conyers delegates share their highlights from banner events in the industry.
Bolder Group Industry Panel, Bangkok – Cayman Islands: Key Insights into a Premier Fund Jurisdiction
Director and Head of Singapore office Preetha Pillai was pleased to join industry leaders in Bangkok this April to discuss the many reasons for Cayman’s status as a premier global funds jurisdiction. Preetha’s remarks on the jurisdiction’s legal and regulatory framework formed part of broader panel discussions around fund structuring, tax considerations, corporate governance, investment management and risk consideration, and the role of fund administrators.
IBA International Conference on Private Funds, London
The annual IBA Private Funds conference in London was held this year from 9 – 11 March. Cayman Counsel Jennifer Sangaroonthong was among the Conyers delegation and shares her key takeaways from this cornerstone event in the funds industry calendar.
Our Key Takeaways from the IBA Private Funds Conference
The IBA Private Funds Conference provided valuable insights into the evolving landscape of private funds. With discussions ranging from macroeconomic uncertainty to emerging investor trends, industry experts dissected key challenges and opportunities shaping the sector. Here are seven major takeaways from the event.
1. Macroeconomic Uncertainty: A Mixed Bag
Panellists discussed the positives of the Trump administration’s proposed deregulation in areas such as investment funds and the relaxation of enforcement actions by the SEC for the digital assets industry. However, the administration’s unpredictable economic policies — including newly proposed tariffs — have introduced market uncertainty, particularly regarding their impact on global trade.
Despite this, the digital assets industry remains optimistic about a more crypto-friendly SEC and a clear regulatory framework.
2. Sponsor Trends: Consolidation and Strategy Diversification
The regulatory complexities and uncertain economic climate are driving a wave of manager consolidation. As smaller and mid-sized firms struggle to compete, larger players continue to expand. Additionally, managers are expected to diversify their strategies, with a growing focus on real estate, infrastructure, and credit in the near term.
3. Investor Trends: Selectivity and Bespoke Arrangements
Fundraising dynamics are shifting, with investors increasingly demanding flexible, customised arrangements before committing capital. The complexities of these demands are straining resources for some fund managers and are fuelling a rise in evergreen and hybrid structures.
4. New Capital Sources: A Broader Reach
In the quest for capital commitments, fund managers are increasingly targeting retail investors and private wealth/family offices as strategic avenues to expand their funding base.
5. Continuation Vehicles: The New Norm
Once viewed with skepticism, continuation vehicles are now gaining mainstream acceptance as a practical exit strategy in today’s economic environment. The challenge for General Partners (GPs) is to strike the balance of giving value to exiting Limited Partners (LPs), providing an incentive to continuing LPs and attracting new LPs. In some instances, LPs are demanding a higher degree of alignment with GPs who have increased their GP commitments.
6. Credit Funds: Embracing Evergreen Structures
GPs and LPs are embracing evergreen-like structures to minimize fundraising cycles, save on costs, and maximise operational efficiencies. Such structures are highly complex given that GPs will need to consider (among other things) investor equalisation and portfolio composition.
7. Insurance Companies: The Role of Rated Note Feeders
Rated note feeders are proving to be popular vehicle of choice for insurance capital. Meanwhile, there has also been an increase of insurance company acquisitions by managers themselves and fund managers have also been stepping up their involvement in assisting insurance companies with the set-up of sidecar structures.
Final Thoughts
The conference underscored the shifting dynamics of private funds and the industry’s resilience in adapting to market uncertainty. Whether through diversification, new capital sources, or innovative structuring, fund managers are finding creative ways to navigate challenges and seize opportunities in a rapidly evolving landscape.
UPCOMING INDUSTRY EVENTS
Consensus 2025 – “Crypto’s Most Influential Event”
Toronto, 14-16 May 2025
Consensus has been bringing together the most influential voices in blockchain, Web3, and AI since 2015. This year the experts convene in Toronto to “weave together breakthrough technologies, from digital assets to artificial intelligence, fostering the collaborations that define what’s next.”
Meet the Conyers Delegation:
Theo Lefkos | Róisín Liddy-Murphy | Spencer Vickers | Clare Bradin | Sarah Howie | Jennifer Sangaroonthong | Lana Dixon |
AIMA Next Generation Manager Forum
London, 28 May 2025
London Partners Eric Flaye and Nicholas Pattman will be attending this forum for senior individuals at alternative asset management businesses managing up to US$500 million in hedge and private credit assets.
AIMA Global Investor Forum 2025 – “Leadership in Alternatives”
Toronto, 15 October 2025
AIMA serves as a gathering for institutional investors, alternative asset managers, and industry professionals shaping the hedge fund, private credit, private equity, and digital asset industries globally.
CoinAlts Annual Fund Symposium – “Discover the Future of Finance”
San Francisco, 29 October 2025
Partner Theo Lefkos, Head of Private Equity – Cayman, will be attending this gathering for the digial asset community that annually addresses investment, legal and operational issues of concern to private fund managers.
Conyers Thought Leadership
Holt the Press! Developments in SPC Restructuring
Jonathon Milne, Jordan McEarlean
Cayman Segregated Portfolio Companies (SPCs) are popular vehicles for use by investment funds. As many readers will be aware, SPCs are different from typical Cayman Islands companies in that the assets and liabilities of each segregated portfolio (SP) are segregated from each other during the life of the SPC (and in liquidation). In late 2023, in the case of Holt Fund SPC, the Grand Court of the Cayman Islands ordered the first appointment of Restructuring Officers over particular segregated portfolios of an SPC.
Typically, where a particular SP has insufficient assets to meet claims of creditors, a receiver may be appointed for the purpose of an orderly closing down of the business of that SP. However, until the Holt judgment, it was not clear that Restructuring Officers could be appointed in relation to a specific SP, given that it is not a separate legal entity. This decision illustrates the flexibility of the restructuring regime. However, the application to appoint Restructuring Officers was unopposed, so it will be interesting to see if such appointments are subject to challenge in future.
Segregated Portfolio Companies: Cayman Courts Upholding the Segregated Principle
Piers Alexander
A Segregated Portfolio Company (SPC) provides for the protection of the assets held under one portfolio by ring-fencing them from the liabilities of other portfolios in the same company. Whilst structures similar to the Cayman Islands’ SPC have been replicated in other jurisdictions, including those onshore, Cayman has the distinction of having built up a body of definitive case law examining the segregated portfolio principle. This is important in light of the significant numbers of SPCs in operation in Cayman. Read more in this article by Hong Kong Partner and Conyers Global Head of Investment Funds Piers Alexander.
Common Reporting Standard: Regulatory Enforcement and Compliance for Cayman Entities
Róisín Liddy-Murphy, Sarah Howie, Tonicia Williams, Daniella Carrazana
Cayman Islands investment funds are considered “Financial Institutions” and as such have direct obligations under the Cayman Islands Tax Information Authority’s Common Reporting Standard Regime. This article provides a detailed overview of the requirements and implications of these regulations.
Listing Investment Funds on the Cayman Islands Stock Exchange
Flora Zeng
The Cayman Islands Stock Exchange (CSX) facilitates the trading of diverse securities, including investment funds (both open-ended and closed-ended), corporate and retail debt, eurobonds, equities (domestic and international), derivative warrants, and Segregated Portfolio Companies (SPCs). In this article, Hong Kong Senior Associate Flora Zeng considers the whys and hows of listing on the CSX, and special considerations for investments funds.
Why Set Up a Tokenised Investment Fund with an Approved Manager in the BVI?
Flora Zeng
Setting up a tokenized investment fund with an approved manager in the British Virgin Islands offers many strategic advantages by combining the innovative benefits of blockchain technology with cost-effectiveness and the operational efficiencies of the BVI’s financial services regulatory framework. In this article Hong Kong Senior Associate Flora Zeng explore the benefits of tokenized investment funds and the BVI approved manager regime.
Preetha Pillai and Rita Leung
The Cayman Islands are home to 118,443 active companies as of 31 December 2024, with 11,819 new companies registered in 2024 and a further 1,081 in the first two months of 2025. This factsheet outlines the reasons for the Cayman Islands’ popularity as a jurisdiction to structure international transactions.
Regulatory Updates for Bermuda Investment Funds
The Investment Business Amendment Act 2024 (the “Amendment Act”) came into operation on 29 July 2024. The Amendment Act amends the Investment Business Act 2003 (as amended, the “Act”) to strengthen the supervision and regulation of Bermuda based investment exchanges and clearing houses. In particular the Amendment Act introduces a framework for an investment exchange or clearing house to apply to the Bermuda Monetary (BMA) for designation as a “recognised investment exchange” or “recognised clearing house” (collectively, “Recognised Bodies”), as applicable, under the Act, thereby allowing it to carry on such business in Bermuda without requiring a licence or registration under the Act.
Once the BMA has issued a recognition certificate designating an investment exchange or clearing house as a recognised investment exchange or recognised clearing house (as applicable) under the Act, a Recognised Body will be subject to the BMA’s supervision and certain ongoing requirements under the Act and its subsidiary regulatory framework, including the following:
- preparation of annual financial statements or accounts;
- appointment of an approved auditor to audit the annual financial statements or accounts;
- filing of annual financial statements or accounts, and auditor’s report, with the BMA;
- filing of half-yearly returns with the BMA;
- notifying the BMA in advance of any proposal to amend its constitution or its market or listing rules;
- notification requirements relating to persons becoming or ceasing to be “controllers” or “officers” of the Recognised Body;
- capital and liquidity requirements;
- notification requirements in the event of a breach of capital or liquidity requirements;
- reporting certain prescribed facts or matters of “material significance” to the BMA; and
- continuing to satisfy the recognition standards required for designation as a Recognised Body on an ongoing basis;
- payment of annual fee to the BMA.
The 2025 BMA filing deadline for all authorised and registered Bermuda investment funds with a financial year end of 31 December is 30 June 2025.
Attention! Know the Regulatory Obligations of Your Cayman Closed-Ended Fund
Piers Alexander
The regulatory environment for Cayman Islands investment funds has changed significantly over the last few years as the jurisdiction has updated its funds regime to remain compliant with international standards of the European Union and the Financial Action Task Force. While there are significant benefits to operating a private fund in one of the world’s leading offshore funds jurisdictions, fund operators should take steps to ensure that they comply with their regulatory obligations when operating a Cayman private fund so as to avoid administrative fines or enforcement action by CIMA.