The government of the Bahamas has completed legislation to oversee the issuance and trading of cryptocurrency.
The DARE Bill 2020, as seen by the Nassau Guardian, outlines regulations for sellers and intermediary service providers of digital tokens – as well as the penalties for breaking them.
Fines of $500,000 or prison sentences of up to five years could be imposed on people who commit offences under the act.
Other punishments include a public reprimand, being banned from certain operations, suspension, redundancy, and more.
Businesses that provide digital token exchanges, custodial wallet services, digital custody services, and the transfer of digital assets will be required to register with the Securities Commission of The Bahamas (SCB).
The Bahamas is keen to be at the forefront of the cryptocurrency sphere and has introduced a number of initiatives to develop the industry and encourage investment.
The Central Bank of The Bahamas has introduced a digital version of the Bahamian dollar under a pilot scheme.
The central bank digital currency (CBDC) has been dubbed the ‘Sand Dollar’ by officials and the initiative as a whole is referred to as ‘Project Sand Dollar’.
It will launch in the Exuma region and extend to the Abaco area in the first half of 2020.
A statement says this is a continuation of the Bahamian Payments System Modernisation Initiative (PSMI).
The scheme, which began in the early 2000s, aims to improve financial inclusion and access for the nation’s unbanked.