CBB issues amendments to crypto-assets module

All offers of digital tokens that exhibit the characteristics of security will now be regulated by the Central Bank of Bahrain (CBB).

This follows the issuance of amendments to the CBB’s crypto-assets (CRA) module following a consultation process with the industry stakeholders.

With the new amendments, the CBB expanded the scope to include digital token offerings as part of its framework for regulated crypto-assets activities.

In determining whether a digital token qualifies as a security, the regulator will examine the underlying economic purpose of the digital token, its structure, characteristics, as well as the rights attached to the digital token.

The amendments also outline new requirements to enhance safeguarding clients’ assets to provide high levels of protection for investors.

Furthermore, the new amendments allow crypto-assets licensees (after obtaining the CBB’s approval) to engage in additional activities, which are not within the stipulated regulated crypto-asset services.

The amendments aim to cater to ongoing developments in the crypto-assets markets and comply with the industry best practices while enhancing investors’ protection, as part of the CBB’s plan to further develop the crypto-assets market in line with the Economic Recovery Plan.

Commenting on the amendments, CBB director of capital markets supervision Abeer Al Saad said: “We at the CBB are delighted to issue the new amendments to our regulatory framework for crypto-assets and to specifically introduce new regulatory requirements for the digital token offerings, in order to regulate the crypto-assets market in a fair and transparent manner. Therefore, the CBB has adopted a risk-based regulatory approach towards requirements, which are proportionate and commensurate to the regulated activity undertaken by a licensee.

“We endeavour to provide adequate safeguards to investors without inhibiting innovation adoption at the CBB, as we continue to monitor market trends and review the regulatory framework to keep up with the latest developments in the field, as well as maintain the competitiveness of the sector. This milestone is a reflection of the pioneering role the CBB continues to play in regulating crypto-assets.”


Source: https://www.gdnonline.com/Details/1218150/CBB-issues-amendments-to-crypto-assets-module


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