Bahamas unveils DARE 2024 law to restore crypto hub status post-FTX
The Bahamas Securities Commission has announced the passage of new crypto legislation nearly two years after FTXs collapse.
The Digital Assets and Registered Exchanges Act, 2024 (DARE 2024) aims to provide regulatory clarity for the countrys digital assets industry and re-solidify its position as a pro-crypto hub.
Christina Rolle, the executive director of the Securities Commission, said DARE 2024 provides a new standard in digital asset regulation and is a testament to the financial regulators commitment to robust risk management. She added:
We have created a framework that not only focuses on investor protection, but also encourages responsible innovation, positioning The Bahamas at the forefront of digital asset regulation globally.
The Bahamas attracted global scrutiny following the shock collapse of the FTX exchange, which was headquartered in the country, in 2022. Before its failure, the firm was valued at $32 billion, and its now imprisoned founder and CEO Sam Bankman-Fried, also based in the Bahamas, was viewed as the golden boy of a thriving industry.
At the time, the Caribbean nation faced increased questions about the potency of its crypto regulations and a decline in the number of crypto companies expanding to its region.
DARE 2024
DARE 2024 broadens the scope of regulated digital asset activities to include advisory and management services. It also regulates digital asset derivatives, staking services, and other activities as the industry evolves.
The law introduces stricter requirements for digital asset exchanges to ensure robust investor and consumer protection. It also establishes a comprehensive custody framework for digital asset custody and custodial wallet services.
DARE 2024 provides clear definitions and guidelines for staking services and stablecoins. The law details the registration process, asset reserve policies, and custody management for stablecoins.
Additionally, the law mandates timely disclosure and financial reporting. It addresses conflicts of interest and relationships with connected third parties and categorizes NFTs as financial or consumer assets.
Notably, DARE 2024 prohibits the issuance of algorithmic stablecoins and privacy tokens and imposes certain restrictions on Proof-of-Work (PoW) token mining activities in the country.
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Text source: CryptoSlate
