The Bahamas parliament has recently passed a new law called The Digital Assets and Registered Exchanges Act, 2024, also known as DARE 2024. This law comes in response to the collapse of the cryptocurrency exchange FTX, which was headquartered in The Bahamas back in November 2022.
The Securities Commission of The Bahamas made the announcement about this new law, highlighting that it aims to tighten the country’s crypto regulations. The DARE 2024 builds upon the foundation laid by the DARE Act, 2020, and introduces comprehensive reforms to address the evolving landscape of digital assets and cryptocurrency markets.
One of the key aspects of DARE 2024 is that it covers a wider range of digital asset activities, such as advisory or management services, digital asset derivatives, and staking services. The law also includes stricter investor and consumer protection requirements, including stringent systems and controls. Additionally, it introduces new disclosure and financial reporting requirements, brings custody services under its regulations, and establishes a comprehensive stablecoin framework while banning algorithmic stablecoins.
After the collapse of FTX in 2022, The Bahamas expressed its commitment to strengthening its crypto laws to regain trust and credibility as a financial services hub. Prime Minister Philip Davis mentioned during a conference last year that the DARE Act would include measures to regulate stablecoins more clearly and enhance investor and consumer protection mechanisms.
Christina Rolle, the Executive Director of the Securities Commission, emphasized that the new law reflects a dedication to robust risk management and responsible innovation. The framework created not only focuses on protecting investors but also encourages innovation in the crypto space.
In conclusion, the passage of the DARE 2024 in The Bahamas demonstrates the government’s proactive approach to regulating the crypto industry and ensuring the protection of investors and consumers. The law sets a precedent for other jurisdictions looking to enhance their regulatory frameworks in response to the evolving digital asset landscape.