Bahamas tops list of countries that have developed digital assets legislation

The Bahamas tops the list of a Global Crypto Regulation (GCR) Index compiled by cryptocurrency security firm Solidus Labs, which cites as its mission the enabling of safe and regulated crypto markets, according to the Solidus website.

The Bahamas ranked 4.90 out of the GCR’s five-point scale.

This country’s Digital Assets and Registered Exchanges Act (DARE) has so far lured FTX, one of the world’s largest cryptocurrency exchanges, to this jurisdiction, and others have followed.

FTX’s executives said they chose The Bahamas for many of the reasons heralded in Solidus’ index.

“The Bahamas has received a high rating because it provides a comprehensive and progressive regulatory regime, clear registration requirements and a positive environment set by government action and rhetoric to foster economic growth through a robust digital asset industry,” the index assessment said.

“In December 2020, the government established one of the world’s few comprehensive regulatory frameworks for digital assets.

“The landmark law, called the Digital Assets and Registered Exchanges Act (DARE), includes a legal definition for digital assets, licensing and registration requirements for exchanges, and investor protection standards, as well as compliance standards in line with the Financial Action Task Force (FATF) recommendations for anti-money laundering measures and the relevant principles of the International Organization of Securities Commissions.

“In fact, in its latest mutual evaluation report (MER), FATF noted that The Bahamas ‘has made significant progress in addressing technical compliance deficiencies and several of the country’s ratings on compliance requirements were upgraded. The Bahamas is also the first country in the world to launch a nationwide CBDC [central bank digital currency], the Sand Dollar.”

Solidus said the exponential growth in crypto and decentralized finance (DeFi) initiatives have spurred global growth in digital assets regulations. The company said the GCR was developed to provide a snapshot “of where digital asset regulations currently stand, ranking key countries that have taken effective approaches to regulation that both protect consumers and encourage innovation”.

The GCR said top countries in the digital assets regulations space were recognized for myriad reasons, including that digital assets have been recognized as legal by the government; there are no blanket restrictions on digital asset activity; and that digital assets have received positive policymaker engagement. 

The GCR added that top jurisdictions also featured digital assets legislation that is comprehensive; has been implemented and is in operation; includes a classification of digital assets, registration/licensing requirements; has instituted market surveillance and preventions against market manipulation; registration and licensing that covers multiple types of digital asset service providers; efficient registration and licensing processes; and that anti-money laundering/combating the financing of terrorism (AML/CFT) requirements have been adopted for digital assets.

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Chester Robards

Chester Robards rejoined The Nassau Guardian in November 2017 as a senior business reporter. He has covered myriad topics and events for The Nassau Guardian. Education: Florida International University, BS in Journalism

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