The Bahamas Maintains Optimistic Outlook on Crypto Amid FTX Debacle

In the spirit of celebration, The Bahamas Prime Minister Philip Davis raised a glass to the persistence and development of the crypto ecosystem despite the ongoing FTX debacle. 

FTX Debacle ‘Emboldened Crypto Critics’

Prior to the FTX collapse, the cryptocurrency exchange was headquartered in The Bahamas and it was a major player in the country’s digital asset ecosystem. However, Davis stood up at his table at the fine-dining restaurant Nobu to deliver a toast where he asked attendees to forget about FTX and not be derailed from the promises of crypto.

“The only thing the FTX debacle did was embolden crypto critics,” he said, adding that, “The digital asset world is here to stay.”

The dinner was held at the luxury Atlantis resort on Paradise Island, north of Nassau, marking the opening of D3 Bahamas, a conference put on by the Bahamian government, designated to update its crypto regulations. Following the implosion of FTX, The Bahamas introduced a new set of consumer protection measures, including requirements around the segregation of customer and corporate assets. 

“We are committed to ensuring this aspect of our financial services industry keeps good actors in and bad actors out,” said Davis, before raising his glass.

Sadly, this was one of the regulations which FTX and its sister trading firm Alameda Research failed to adhere to while still operational. Their non-compliance contributed significantly to the alleged fraud by Sam Bankman-Fried, the crypto exchange’s former Chief Executive Officer (CEO) for which he is currently facing trials for.

The Bahamas Doubles Down on Crypto Regulation

The Bahamas referred to the latest update in its regulatory framework as a reflection of the ongoing development in the crypto ecosystem. At the same time, it is also a reflection of the lessons learnt from the collapse of the FTX. Notably, this is not the first precautionary measure that the nation has taken since the FTX collapsed. 

Before this time and after FTX collapsed, the Securities Commission of the Bahamas (SCB) introduced a whole new set of rules through the DARE Bill to regulate the activities of Virtual Assets Service Providers (VASPs) operating in the region. 

Precisely, the regulator strengthened the financial and reporting standards for trading platforms, custody service providers, staking operators and asset managers in the region.