The Tribune

By YOURI KEMP

Tribune Business

Reporter

ykemp@tribunemedia.net

THE Opposition’s leader says it is still too early to determine how The Bahamas’ laws and regulations governing the digital assets industry should be reformed following the FTX crypto exchange’s spectacular implosion.

Michael Pintard, speaking at a Free National Movement (FNM) protest in front of the Prime Minister’s Office, asserted that “no government of The Bahamas is responsible” for FTX’s stunning collapse in less that one week. However, he argued that it is the Davis administration’s job to fix the reputational damage being inflicted upon The Bahamas as a result.

“The Government also has an obligation to clearly indicate if it has any intimate relationship with companies that are in The Bahamas, that can give the impression that companies were able to operate with impunity because of the nature of that relationship… We have been very measured in the statements that we have made concerning FTX and its implosion, and the negative impact that it’s having on The Bahamas,” he said.

FTX switched its international headquarters from Hong Kong to The Bahamas in September/ October 2021, the move coming within weeks of the general election that brought the Davis administration to power. Sam Bankman-Fried, FTX’s co-founder and then-chief executive, said the crypto exchange was attracted to this nation by the Digital Assets and Registered Exchanges (DARE) Act as it wanted to be in a well-regulated, compliant jurisdiction.

The DARE Act was introduced to Parliament, and passed, by the former Minnis administration, so the Opposition cannot completely disassociate itself from the FTX fall-out. The crypto exchange was supposed to be the flagship digital assets investor for The Bahamas, and one that would attract other such businesses to this nation. However, its collapse may endanger the country’s digital assets ambitions.

Mr Davis previously said the DARE Act was in the process of being enhanced and upgraded even prior to the FTX collapse. When asked what an FNM administration would do about amendments to the DARE Act, Mr Pintard said: “It’s too early to tell. We need a thorough investigation, which is why we ought to look at the period prior to the election and after the election.

“When did they come? Who did they meet with? What was the nature of the discussion? When were the approvals given? Was there a lead time? We know that certainly companies operating in this space are not going to get a 14-day or seven-day approval, so the question is how long was the due diligence period and what would we have found during that due diligence period?

“The broader fight that we have is that there are international regulatory agencies that have, unfortunately, held us to a standard in terms of compliance to regulatory rules that they themselves have not measured up to. That is a problem.”