NASSAU, BAHAMAS — Prime Minister Philip Davis said yesterday that the lessons learned from the collapse of FTX will only strengthen this nation’s digital assets framework and propel the sector forward.
The Prime Minister made the comments while addressing the first-ever MasterCard Fintech Summit held in The Bahamas at the Rosewood, Baha Mar. He further noted that the key to long-term success in the fintech and digital assets space is the development of an effective regulatory framework.
“In The Bahamas, our Digital Assets and Registered Exchanges (DARE) Act is hailed as one of the most rigorous and effective frameworks in the world,” Davis claimed.
“The DARE framework reflects global best practices with an added touch of Bahamian innovation, positioning us as a world leader in the regulation of digital assets. The legislation is comprehensive and provides clarity and oversight without stifling innovation. It is also highly responsive. We knew we needed a highly adaptive approach to keep pace with industry changes,” the Prime Minister stated.
He continued: “Recognising the importance of staying ahead of the curve, we intend to pass a series of amendments to the DARE Act this year with the Digital Assets Registration and Exchanges Bill, 2023. The revamped regime aims to encompass lessons learned globally since the introduction of DARE and to situate The Bahamas at the forefront of the rapidly evolving digital asset regulatory space, with an even stronger, more comprehensive regulatory framework.”
According to Prime Minister Davis, the lessons learned in the wake of FTX will only strengthen the DARE framework in the long term and propel the country’s digital assets sector forward.
“New amendments to the legislation include–among other things–measures to clarify the regulation of stablecoins, more robust investor and consumer protection mechanisms, and the regulation of staking for digital asset-related mining in The Bahamas. We are innovating, not only in response to our own experiences and insights but in anticipation of the direction that the industry is headed,” said Davis.
He further noted that this nation’s ability to adapt its regulatory framework to the most stringent global standards, while building a competitive financial services product that appeals to clients from around the globe, makes The Bahamas the ideal jurisdiction for emerging Fintech opportunities.
“Our digital transformation agenda will make The Bahamas more competitive on the global stage,” said Davis. “Digital and financial inclusion have critical roles to play in the new economy. And that is as true for our financial systems as it is for our governmental systems.”
The Prime Minister noted that regionally, the loss of correspondent banking relationships has created millions of unbanked people throughout Latin America and the Caribbean who are in need of solutions.
“We have faced our own challenges in The Bahamas as local banks have pulled out of less populated islands, leaving residents without a single financial institution to rely on. Many people are forced to travel by boat or plane to perform basic financial transactions.
“This reality, though regrettable, represents an opportunity to advance the uptake of financial technology and, in turn, promote greater financial inclusion across our archipelago,” Davis said.
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