Regulation
Bahamas Unveils DARE Act 2024 to Restore Crypto Hub Status After FTX
The Bahamas Securities Commission has announced new cryptocurrency legislation nearly two years after the collapse of FTX.
Digital Assets and Registered Exchanges Act, 2024 (Dare 2024) aims to bring regulatory clarity to the country’s digital asset sector and cement its position as a pro-crypto hub.
Securities Commission Executive Director Christina Rolle said DARE 2024 provides a new standard for digital asset regulation and demonstrates the financial regulator’s commitment to rigorous risk management. She added:
“We have created a framework that not only focuses on investor protection, but also encourages responsible innovation, positioning The Bahamas at the forefront of digital asset regulation globally.”
The Bahamas have attracted global surveillance following the shock collapse of the FTX exchange, which was headquartered in the country, in 2022. Before its bankruptcy, the company was valued at $32 billion, and its current value Founder and CEO Sam Bankman-Fried jailedalso based in the Bahamas, was considered the boy wonder of a thriving industry.
At the time, the Caribbean nation was facing growing questions about the strength of its crypto regulations and a decline in the number of crypto companies expanding into its region.
Dare 2024
DARE 2024 expands the scope of regulated activities related to digital assets to include advisory and management services. It also regulates digital asset derivatives, staking services and other activities as the industry evolves.
The law introduces stricter requirements for digital asset exchanges to ensure strong investor and consumer protection. It also establishes a comprehensive custody framework for digital asset custody and custodial wallet services.
The DARE Act 2024 provides clear definitions and guidelines for staking services and stablecoins. The law details the registration process, asset reserve policies, and custody management of stablecoins.
Additionally, the law requires timely financial disclosure and reporting, addresses conflicts of interest and connected third-party relationships, and classifies NFTs as financial or consumer assets.
Notably, DARE 2024 prohibits the issuance of algorithms stable coins and privacy tokens and imposes some restrictions on proof of work (PoW) token mining activities in the country.