The new regulation establishes a set of rules and standards for crypto asset services
On February 25, 2019, Bahrain’s media outlet TradeArabia has reported that Bahrain’s Central Bank has issued new regulation on cryptocurrency. Before, in December 2018, Central Bank of Bahrain had created draft proposals were potential regulation and licensing of crypto asset services were considered.
According to the news, the established rules consider governance, licensing, risk management, counter-terrorist financing measures and anti-money laundering and, conflict of interest avoidance, cybersecurity, and so on. The new regulation also determines new standards in the field of supervision and enforcement.
Cryptocurrency exchanges which get a license from Bahrain’s central bank will also have to follow guidelines concerning pre- and post-trade transparency, order matching, market manipulation and avoidance of market abuse.
Furthermore, TradeArabia has reported that the new regulation prescribes that the digital currency exchanges must have improved due diligence when onboarding new customers, and must guarantee that safe encrypted custody wallets can always be retrieved.
Some time ago, Central Bank of Bahrain created a regulatory sandbox that enables blockchain and crypto companies to work in the country until formalized regulations will be approved.
Author: Helen Darkhouse