ST. GEORGE’S, Grenada, The Grenada Bankers Association (GBA) says it is eagerly awaiting the new legislative framework that will ensure the integrity of the regional financial landscape as new products such as cryptocurrencies and other digital assets become a norm in the financial environment.
“There is no denying that as the financial landscape changes and new products or methods of doing business emerge, there is the need for legislative and control frameworks to support and protect our people and preserve our financial space,” the GBA in response to a recent report from Global Financial Integrity that as a growing number of consumers adopt the use of cryptocurrency, governments in Latin America and Caribbean (LAC) have failed to prevent, detect, investigate and prosecute financial crimes that may arise in this space.
Entitled “Cryptocurrencies: A Financial Crime Risk within Latin America and the Caribbean,” the report analyzes the benefits of crypto as well as the potential risks that may emerge, both for consumer financial protection as well as for financial crimes. It also maps the responses from governments, the private sector, academia, and civil society in light of rapidly changing dynamics in the region.
GPA president, Larry Lawrence, said that “as it relates to the use of cryptocurrencies, there is currently no finalized regulatory framework in either the Eastern Caribbean Currency Union (ECCU) or many other global countries to govern this area.
“The Eastern Caribbean Central Bank (ECCB) and the Eastern Caribbean Securities Regulatory Commission (ECSRC) have issued warning notices to the public to exercise caution in engaging in the use of crypto-currencies.”
Financial institutions, particularly commercial banks here and throughout the ECCU, have exercised due care and caution in dealing with crypto-currencies given its anti-money laundering and financing of terrorism (AML/CFT) risks.
“Throughout the Eastern Caribbean Currency Union, there has been advancement in the legislative and regulatory framework and support structures for these asset types.
“We have also seen the provision of regulated alternatives mindful of market needs and global developments; one such example is the Digital cash ‘D-cash’ – the digital version of the EC Dollar supported by the ECCB,” said the GBA, noting that Grenada has enacted the Virtual Asset Business in 2021.
The Virtual Assets Business Act is a regional uniform law that has been enacted in most of the ECCU member countries to date. In Grenada, the enforcing and implementing agency will be the Grenada Authority for Grenada for the Regulation of Financial Institutions (GARVIN).
The GBA is of the opinion that the approval of the legislation is proof of the region’s awareness and active approach to adapting to the changes in the market. Though the law was approved by Parliament, GARVIN is still awaiting the regulations to commence enforcement of the legislation.
“Despite the enactment of the legislation, we are aware that Grenada continues to develop the supporting regulatory framework and systems. The Banking community eagerly awaits and supports any structures to ensure that integrity and transparency of the financial space are maintained,” The GBA added.