The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

A Cabinet minister and a member of the Government’s Digital Advisory Panel have both warned that digital assets are not a “silver bullet” that will rescue the Bahamian economy by themselves.

Gowon Bowe, Fidelity Bank (Bahamas) chief executive, told a forum organised by the Organisation for Responsible Governance (ORG) that crypto currencies, blockchain technology, non-fungible tokens (NFTs) had been “romanticised” to the point where some Bahamians had become oblivious to the associated risks.

“I would say that it certainly is not a silver bullet,” he added of digital assets, “and the reason why I say that is that we have to respect and appreciate that the crypto currency industry or the digital asset space is actually an extension of - or an expansion of - investment opportunity.

“It has high volatility, it has attendant risks and it has winners and losers, and we have romanticised that to some extent because we have heard the stories of investing $1,000 and coming out a billionaire.”

Mr Bowe, whose views were his own, added: “We’ve not focused enough attention on those who invested millions and came out as ‘thousand-aires’. Meaning that there’s only a zero sum game that we are talking about. Trading is having independent parties with their different professional opinions and judgments, making assumptions about future trading in relation to that.

“There are so many things that go along with a new type of sectoral activity - from the opportunity to collect taxes, to chances for employment for different people and the “‘knock-on’ effect of new investment spurring other economic activity. If these factors are not coming to bear with the increase in attention to digital currencies, then the answer is ‘no’ if it is a means to solving our economic problems.”

Michael Halkitis, minister of economic affairs, backed Mr Bowe and said: “The whole crypto industry is very, very polarising. Some people swear by it and say this is the future and it’s the best thing. Then there’s some who want it to go away, some of the big countries and those regulators, and who are actually trying to make it go away.

“I agree, it’s not a silver bullet, but to the extent that we have attracted some operators in the space now because of our regulation, we just need to make sure that we continue to modernise our regulation and that we build more capacity in terms of regulation, build capacity in terms of more jobs for Bahamians in areas of compliance and regulation, and we also build capacity in terms of operating the business.

“So this is a tremendous opportunity. I would treat it as a building a portfolio. You don’t put all of your money in crypto. If you have a portfolio and you have some investments, you put a portion in it, understanding that it can be very volatile.”