Gibraltar launched the DLT regulatory framework on January 1st. The news came a month after a bill to update financial services regulations was approved by the Legislature of Gibraltar.
According to the DLT framework, all companies situated in Gibraltar using blockchain technology “for storing or transmitting value belonging to others” will have to attain a license from the Gibraltar Financial Services Commission (GFSC).
The framework presents nine principles instead of rules, “This is because for businesses based on rapidly-evolving technology, such hard and fast rules can quickly become outdated and unfit for purpose.”
GFSC’s head of risk and innovation Nicky Gomez, stated, “We are really excited to finally welcome applications from DLT Providers. The team expect to be very busy in the coming months, and are looking forward to working on some interesting and innovative ideas with applicants.”
Gomez was also proud that Gibraltar was the first regulator in the world to take such a bold step, “Working closely and collaboratively with the financial services industry and the Government of Gibraltar has resulted in the GFSC becoming the first regulator to introduce a DLT Regulatory Framework – it is a very encouraging time and we are also looking forward to the challenge.”
The Authorization Process
The authorization process will consist of three stages: pre-application engagement, initial application assessment, and full application and presentation. After issuing the license, GFSC will also pay a visit to the DLT firms to ensure that the topics covered in the last stage are correctly implemented.