Paul Astengo, Senior Executive Gibraltar Finance
Since Gibraltar became the first jurisdiction to introduce a purpose built Distributed Ledger Technology (DLT) regulatory framework in January 2018, I have had the opportunity to meet with global leaders, cultivate ties with top education institutions, and showcase the value of our principles-based framework. In that time, the range of exciting projects that have applied and gained DLT Provider licences gives expression to the success of this framework, and vindicates the principles-based approach that has defined Gibraltar’s DLT regulation.
With a steady stream of quality projects receiving DLT licences in recent months, Gibraltar’s ascent as a bonafide DLT trailblazer has not gone unnoticed. Quite the contrary actually. There is a sense of admiration emanating from policymakers and regulators worldwide, and I am constantly fielding questions around how Gibraltar has risen so quickly as a DLT jurisdiction, attracting interest from a diverse range of blockchain projects. The answers to such questions are invariably intricate and involve great detail, but if I were to characterise Gibraltar’s approach, the term ‘collaboration’ captures it nicely. Taking a lead in the global DLT regulation space is no easy feat, and requires a combined effort from government, industry leaders, and educational institutions to cultivate the right conditions that will resonate with a community of global DLT platforms. This formula for success has opened the door to ambitious blockchain companies who are seeking a DLT licence – a trend that has endured over the last few months as our DLT community continues to go from strength to strength.
Recently, the Gibraltar Financial Services Commission (GFSC) awarded DLT licences to a number of platforms such as crypto-to-crypto lending platform Lendingblock, cryptocurrency exchanges CEX.IO and Bitso; as well as Quedex, a crypto-centric futures and options exchange. These platforms have displayed a firm commitment to adhering to our principles-based approach to regulation as they join the growing cohort of licensed firms operating from Gibraltar, while further elevating the status of the crypto industry globally.
By granting DLT licences to the above platforms, the GFSC has confirmed their respective compliance with Gibraltar’s nine principles for DLT regulation, designed to protect consumers and businesses using digital assets stored or transmitted on distributed ledgers. These regulatory principles include risk management processes, effective corporate governance, and security controls to combat financial and cyber crime.
When our government initiated engagement with industry representatives to build a fit for purpose DLT regulatory framework, the overarching vision was to create a nurturing environment for blockchain projects to flourish. The trickle down effect of this proactivity has powered a wave of quality projects seeking DLT licences, becoming proud flag bearers for our DLT framework. Long may it continue.