Gibraltar Legislation Is In TOP-20 For E-Ready And Blockchainers
RegulationBit News Today2 min read
Gibraltar announced that it would be the first nation to introduce formal blockchain regulation, granting licenses to financial technology companies intending to utilize the technology. Legislative approval of the measures places the British Overseas Territory among a select group of global jurisdictions providing comprehensive regulations for blockchain enterprises.
Gibraltar Legislation Leads The Way For DLT And Blockchain
Beginning on 1 January 2018, the regulations apply to commercial operations utilizing distributed ledger technology to transmit and store value. Service providers utilizing DLT are eligible for operating licenses if they adhere to regulatory principles. This move aimed to provide much-needed regulatory certainty.
Gibraltar paves way for global trend
The legislative change prepared the ground for rules unveiled by authorities to give distributed ledger technology a statutory definition for value storage and transmission. The amendment sought to broaden investor safeguards to include clients of licensed entities conducting controlled, non-investment operations.
Albert Isola, the Minister of Commerce in Gibraltar, welcomed the adoption of the legislation and noted the anticipated interest in securing permits once the specific DLT rules took effect. Isola stated that he knew several firms were preparing to submit applications to the Gibraltar Financial Services Commission on 1 January 2018, calling it excellent news. Nicky Gomez, Head of Risk and Innovation at the GFSC, was quoted saying, "We are really excited to finally welcome applications from DLT Providers."
Samantha Barrass, chief executive of the Gibraltar Financial Services Commission, stated that the framework shows authorities can adapt alongside technological progress without hindering innovation, while also protecting consumers and establishing a secure setting for financial technology. When evaluating license requests and carrying out regulatory oversight, the GFSC focuses primarily on safeguarding consumers and protecting Gibraltar's standing.
Principles-based regulatory regime
The Gibraltar Financial Services Commission's (GFSC) regulatory framework for DLT operates on nine outcomes-focused principles.
To obtain authorization, applicants must submit to a review by the GFSC, which issues a license if specific standards are fulfilled, permitting commercial activity via distributed ledger technology. The initial phase of complete authorization is an in-principle determination, requiring the candidate to satisfy the GFSC regarding specified conditions.
Industry response and next steps
An official from the GFSC indicated that emerging blockchain companies strongly desired regulatory oversight while seeking a dependable jurisdiction for their sector. With this in mind, companies prepared to apply as DLT Providers. Gibraltar is also set to regulate initial coin offerings, a form of startup crowdfunding referred to as token sales. By setting clear guidelines, Gibraltar aims to promote market confidence, reduce systemic risk and cut financial crime.
