The FTX fallout continuation
The Bahamas continues to deal with the fallout from the FTX debacle and, unfortunately, larger countries around the world are pointing fingers at The Bahamas – but is it fair and should those countries not share most of the blame? The Bahamas is a convenient target for larger developed countries but when we look at the dynamics of FTX it is clear that failure in the financial industry globally preceded everything that happened in The Bahamas.
It is interesting that some news outlets are painting a picture of The Bahamas that deflects from glaring mistakes and oversights that led to FTX collapse. For example, global icons like Bill Clinton, Tony Blair, NBA players like Stephen Curry and Shaquille O’Neal among other celebrities all endorsed FTX and promoted it as the greatest thing since sliced bread. The World Economic Forum, Wall Street investors and gurus all sang the praises of the FTX founder. Why is it that they did not discover irregularities and indicate potential problems with FTX?
FTX and Sam Bankman-Fried functioned across the globe in Hong Kong, New York, London, and other financial centers – was actually hailed as a genius and seemed to have been given the keys to the city. If they are pointing the fingers at The Bahamas, should they not have made the discoveries since he would have had much more contact than the top players in the crypto and finance markets?
The Bahamas actually did something innovative and creative in establishing legislation and regulations to accommodate digital assets. We are a small nation with limited resources – and in order to generate income we attract tourists and investors to do business here. It is our business model, so there is nothing that was done that was suspect. We were trying to establish and benefit from a market that is being hailed globally as the big “next” in the world of finance.
It is obvious now that red flags were missed or ignored – but this did not happen in a bubble. The Bahamas was among many countries and entities that were duped by FTX. If there is going to be blame assessed it should be across the board and not targeted at a country that had the foresight to create a legislative environment where this new phenomenon of digital asset trading could create new revenue for its citizens and put us atop the leaderboard globally.
I was informed that The Bahamas was one of the few nations that led the way in this new frontier. Sure, there are lessons to be learned from this event, but for global powers to point the fingers at The Bahamas is irresponsible given the context. The United States allowed Bernie Madoff, Enron, the tech collapse, the banking and hedge fund collapses and other seismic events which clearly demonstrate that they have either not been capable or have been lax in properly regulating their own financial markets.
In every event such as this, there are lessons to be learned and adjustments to be made. I am sure if we continue in this arena our regulators will be more alert and will dig deeper into the operations and reputations of those who come to do business here. We will have to deal with the current ramifications and legal process to figure out the way forward, but at least we have in place a securities commission and a regulative regime that has been set up specifically to address the crypto and digital asset arena.
Jesus made a statement that is often referred to around the world that I think sums up the attitude toward The Bahamas. He said, “Let he who is without sin cast the first stone.” I say to the global powers and media the same thing – if there is a country who has not “sinned” in a similar fashion then they can throw the first rock but just like as happened in the Bible when faced with the question they have to put their rocks up because they themselves are just as or more guilty than The Bahamas.
• Pastor Dave Burrows is senior pastor at Bahamas Faith Ministries International. Feel free to email comments, whether you agree or disagree, to firstname.lastname@example.org. I appreciate your input and dialogue. We become better when we discuss, examine and exchange.