Manama, March 30 (BNA): The Central Bank of Bahrain (CBB) issued amendments to its Crypto Assets Unit (“CRA”) in March, following a process of consultation with industry stakeholders.
The amendments aim to meet the ongoing developments in crypto-asset markets and comply with industry best practices while enhancing investor protection, as part of the Central Bank of Bahrain’s plan to further develop the crypto-asset market in line with the Kingdom’s economic recovery plan. .
With the new amendments, the Central Bank of Bahrain has expanded the scope to include “digital token offerings” as part of its framework for regulated crypto-asset activities. Accordingly, all digital token offerings that exhibit security properties will be regulated by the Central Bank of Bahrain. In determining whether or not a digital token qualifies as security, the CBB will examine the basic economic purpose, structure and characteristics of the digital token as well as the rights associated with the digital token.
The amendments also outline new requirements for enhanced client asset protection to provide high levels of protection for investors. Furthermore, the new amendments allow crypto asset licensees (after obtaining CBB approval) to engage in additional activities that do not fall within the stipulated crypto asset services.
“We at the Central Bank of Bahrain are pleased to issue the new amendments to our regulatory framework for crypto assets and introduce new regulatory requirements for digital token offerings specifically, in order to regulate the crypto assets market in a fair and transparent manner. The CBB said Abeer Al Saad, Director of the Capital Markets Supervision Department. The Central Bank has adopted a risk-based regulatory approach towards the requirements, which are commensurate and commensurate with the regulated activity carried out by the licensee.
“We seek to provide adequate guarantees to investors without hindering the adoption of innovation in the Central Bank of Bahrain, as we continue to monitor market trends and review the regulatory framework to keep abreast of the latest developments in this field, as well as to maintain the competitiveness of the sector. This achievement is a reflection of the pioneering role that the Central Bank of Bahrain continues to play in Regulating Crypto Assets”.
HF