The Securities Commission of the Bahamas (SCB) has released draft legislation that would regulate the issuance or sale of digital tokens in the Bahamas, and how sellers and intermediary service providers conduct themselves.
The SCB released the draft Digital Assets and Registered Exchanges Bill, 2019 ("DARE Bill, 2019") for industry and public consultation for a period of eight weeks. The Bill proposes a legislative structure with standards for entry into and participation in the digital token space.
These requirements stipulate who may participate, the level of capital required, the rules for reporting and seeking the Commission's approval, and the penalties for failure to comply.
Additionally, the proposed legislation requires that participants adhere to established anti-money laundering (AML) and counter-financing of terrorism (CFT) laws, ensure data protection measures related to the personal information of clients, and implement measures to prevent data breaches that would jeopardize clients' crypto assets.
SCB chairman Robert Lotmore said the draft legislation is the first of a series that aims to establish a comprehensive approach to crypto assets regulation.
"The SCB has been working in close consultation with the industry on the development of this Bill, which we anticipate will be the first piece of a suite of legislation that will establish the regulatory framework for crypto assets in the Bahamas," Lotmore said.
"A comprehensive policy position paper will be released next, and the Securities Commission looks forward to input from the industry and general public on that as well."
SCB executive director Christina Rolle said due in large part to the intense interest in crypto related business recently, the jurisdiction had to move to ensure an appropriate regulatory framework is in place.
"Over the last year, the number of queries the jurisdiction has received from entrepreneurs interested in venturing into this form of capital raising has mandated that the jurisdiction ensure legislative and regulatory parameters are in place to address how operators conduct themselves and how token issues come to market."