February 21, 2019, | AtoZ Markets – Bahrain is trying to regain its position in the financial industry. To achieve this goal, the country which once was the center of the Middle East for financial industries, chose to embark on the crypto market.
Crypto companies are welcome in Bahrain, but yet on a pilot basis
According to the local press, the Bahrain government will allow companies engaged in blockchain technology and cryptocurrency trading to work in the country on a pilot basis. The government of Bahrain would like to determine how to regulate cryptocurrencies by running this pilot. Dalal Bouheji, the head of the Bahraini Economic Development Board, expressed her confidence that the Central Bank would issue regulations without a particular deadline. The Central Bank representatives noted that it already had issued draft rules for the crypto asset platform operators.
According to crypto experts, the digital assets trading sector is largely unlicensed and unregulated in the financial sectors. Hence, this forces adopters to clarify rules and prohibitions in smaller jurisdictions, such as Malta, Liechtenstein, Gibraltar and now in the Middle East as well. In one of her tweets Bouheji noted, that over the next 10 years, FinTech startups located in Bahrain are expected to attract huge investments from private funding.
The Bahrain Central Bank allows companies to “test their decision on a limited number of users with a limited number of transactions,” said Buheji. The goal of the program is to find a quick way for companies to enter the market, she added. SprinkleXchange is among the 28 companies that received permission to work within the so-called sandbox of the Central Bank of Bahrain. SprinkleXchange is a platform built on the blockchain technology for the offering of shares.
Each of these companies has been working on a trial basis for nine months, as the Central Bank is studying potential regulation. The exchange, which is managed by New York-based Sprinkle Group SA, will be launched this month – with an initial limit of 10 listings. The company plans to place the first company by May, said CEO Alexander Wallin.
According to the local media reports, the first licensed cryptocurrency exchange in the Arabian Gulf is currently going through the test-phase offered by the Central Bank.