The UK introduces new rules on sandbox regulations for digital assets
The sandbox will allow regulators and selected entities to test use cases of tokenized securities and assets, as well as the use of Blockchain technology in the optimization of certain processes.
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- New rules for UK sandbox regulations
- The space will test use cases related to tokenization and digital assets
- It will also serve to test Blockchain in various processes
- The rules will come into effect at the beginning of next year
UK regulators today announced new rules applying to their regulatory sandbox for digital assets, which will come into effect on January 8, 2024.
Provisions regarding sandbox regulations As stated in official regional government documents, the new regulations are part of the Financial Markets and Services Law of 2023, which sets limits and limitations for activities that can be carried out within the sandbox. as well as the conditions that apply to all entities entitled to participate.
In this regard, the UK Treasury indicated that it will be a joint effort between the organization, the Bank of England and the Financial Conduct Authority (FCA), so that the latter two authorities will take relevant actions to work in an articulated way, within the framework of the new government’s plans for the expansion of the digital asset sector.
Therefore, adjustments to the sandbox turn it into a testing space, where selected regulators and companies can test financial solutions. Looking at the crypto sector, this opens the door to examine use cases focused on tokenizing securities and applications with Blockchain technology to optimize various processes.
Adapting the space While the UK has long had regulatory boxes for testing certain technologies, UK Chancellor of the Exchequer Jeremy Hunt recently called for the need to explore the digital asset sector in more detail in a controlled space.
To achieve this goal, they proposed several changes to the implementation of regulations specifically aimed at digital assets, which would seek to facilitate the adoption of these assets in financial markets.
In this regard, Hunt comments:
The government will establish a statutory instrument to implement the Sandbox… in line with the Edinburgh Reform announcement to implement the Financial Markets Infrastructure Sandbox by 2023.
The adjustments to the sandbox regulations come at a time of particular local interest in digital currencies and asset tokenization, as the coming into force of the new regulations has posed significant challenges for companies in the sector interested in operating in the UK.
Article by Angel Di Matteo / Daily Bitcoin
Image from Unsplash
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