FTX Fall makes Bahamian Regulator stricter on crypto regulations
The collapse of a once leading crypto exchange, FTX, came as a shock and learning to many. The Bahamas is also included in the list of those who took the lessons from the fiasco. Recently, the country has been reported to seek tougher crypto regulations to avoid FTX collapse-like events.
In a press release on Tuesday, April 25, the Securities Commission of the Bahamas (SCB) noted the publication of the Digital Assets and Registered Exchanges (DARE) Bill 2023. The commission placed the bill seeking the expansion of the “definition and list of digital asset business activities” for consultation.
The DARE bill also includes the provisions for strong consumer and investor protection, proper management of risks, innovation and development in the growing asset class market.
With the recently introduced regulations, the commission is looking towards strictly guiding the virtual asset service providers (VASPs) activities willing to conduct business within its jurisdiction.
Bahamian authorities have been criticized by FTX CEO and restructuring officer John Ray III since the crypto exchange filed for bankruptcy. FTX’s current management has reportedly noted in its legal filings about the evidence of the unauthorized access of the Bahamian government to the crypto exchange systems. The access was said to be intended to acquire the company’s controlled crypto assets. However, SCB did not accept, rather opposed the statements made by Ray.
Introducing stricter crypto regulation could be the action in the wake of similar efforts to ensure regulators’ tight grip over the loose ends of the market. It expects increasing scrutiny of crypto companies and follows standards that the EU, US and Hong Kong want to deploy.
The Bahamian commission is reportedly open to taking the consultation until the end of May 2023. According to the proposals, it is looking for the DARE bill’s proposals to come into force by the end of the 2nd quarter of 2023.
After the FTX collapse, the Bahamian police were the first to respond and arrested founder and former CEO Sam Bankan-Fried. He was later extradited to the United States for further proceedings. At the time of the extradition, Bankman-Fried was charged with around eight charges against him, including bank fraud and money laundering, etc. However, as the proceedings progressed, the number of charges increased and now stands at thirteen charges, with the recent addition of bribery.
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional money exchange systems. She is also fascinated by the blockchain technology and its function.
