Govt Wants Flexible Framework for Local Participation in Cryptocurrency Sector Paige McCartney

Pinder was speaking following the publishing of the Davis administration’s policy white paper concerning the future of digital assets in The Bahamas.

He said in addition to ensuring Bahamians are able to be trained and educated for employment in the emerging industry, it is paramount that Bahamians can benefit from direct participation.

“One of the issues with Bahamians being engaged in the industry now has to do with exchange control. And the Central Bank will take the position that you need to convert your Bahamian dollars through the international currency market and the legitimate framework in order to be able to go and invest those in digital assets. That has always been in my view and many others’ views a serious impediment to Bahamians having foreign investments, because of the premiums they charge and the process and bureaucracy involved,” the attorney general said.

“So, you will see one of our commitments in the white paper is to work with the Central Bank to ensure that we can have a more flexible framework for Bahamians to be able to participate, utilizing Bahamian dollars within the digital asset and cryptocurrency framework. The Central Bank has its thoughts on the issues, we have our thoughts on the issue and we hope at the appropriate time we will come together on the issue.”

The $3 trillion cryptocurrency sector has only in recent years become mainstream globally as large banks, investment firms and other financial institutions begin to invest and trade in them on a large scale.

The recently published white paper projected that The Bahamas, one of the first jurisdictions to pass digital asset legislation and regulations, will substantially grow the sector by 2025.

Pinder said the Davis administration doesn’t want The Bahamas or Bahamians on the outside of this financial revolution.

“We, as you know, are setting up an advisory committee and a policy committee that will be working on this. The policy committee is headed by the prime minister and has both the Central Bank governor and executive director of the Securities Commission on that with him, to make distinct policy recommendations on these,” he said.

“We thought it is rather important to have the head regulators at the table with the prime minister in order to be able to get to these decisions. We have the advisory committee it that will make up these recommendations and send them up to the ultimate policy committee to make those decisions. So that’s why you see the breakdown in the white paper between these committees and how we are going to approach the policy changes. But we have said we are going to work toward Bahamians being able to invest in cryptocurrencies utilizing Bahamian dollars, and that that is something we are going to work toward with the regulators.”

The nine-point policy adjectives in the white paper include exploring new opportunities in decentralized finance (DeFi), non-fungible tokens (NFTs), stablecoins and asset-referenced tokens; improving The Bahamas’ attractiveness as a well-regulated jurisdiction for digital assets management; and expanding the current legislative framework.

The paper also pledged that the government will this year start enabling Bahamians’ access to digital assets using Bahamian dollars, and enable the payment of taxes using digital assets.

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