Gibraltar Extends Regulatory Guidelines for Digital Asset Exchanges


Fintech Lawyer

As warnings intensify for the regulation of digital assets across the UK and Europe, Gibraltar is adding to its already regulated digital ledger technology (DLT) framework with the development of a ‘10th Core Principle’, specifically for digital asset exchanges.

Joey Garcia, a partner at the international law firm ISOLAS LLP, who also sits on the boards of the Xapo and IOV Labs (RSK) groups , has brought together members of the Global Blockchain Convergence which include several other global leaders in the blockchain and emerging technology space to form a working group for the development of the new framework, ensuring it meets appropriate defined market standards.

The Market Integrity working group have combined to ensure that the added regulation meets the global market standards for exchanges and other marketplace platforms, while also considering recently defined standards set by the EU and other international bodies.

The framework aims to guide those who have the potential to form important foundational concepts for the work of other international organisations, such as the Financial Action Task Force, the European Commission and the International Organization of Securities Commissions (IOSCO).

Last year, the IOSCO published its standards for trading platforms, and the EU has also published draft regulations for the digital asset space, Markets in Crypto asset regulations (MiCAR) which has included draft proposed requirements for the prevention of market abuse in the space. However, Gibraltar’s amended legislation will be the first set of legislated principles to ensure digital exchanges and operators protect users and market integrity by aiming to ensure standards of design, efficiency, transparency and an orderly market.

This comes at a time where digital assets have been criticised by the Financial Conduct Authority (FCA) in the UK due to a lack of investment regulation or protection.

Gibraltar has been ahead of the curve within the industry, having introduced regulatory oversight to the DLT industry with the introduction of legislation at the beginning of 2018.

Joey said: “The creation of the Market Integrity working group is an important step for the jurisdiction as we continue to develop our DLT framework in line with an ever-evolving regulatory landscape, and also for the Global Blockchain Convergence”

“Gibraltar has long been a leader when it comes to fostering innovation and in the development of virtual asset service providers’ regulatory standards and we are confident the 10th Core Principle will aid us even further in our mission to achieve this, particularly as the integrity of these markets is such a key focus internationally. We already have some of the largest groups in the world regulated in Gibraltar and this should continue to place those groups at the forefront of standard setting in the industry”

“I am grateful to the members of the working group for their contribution and delighted to have such an excellent team of international specialists working with us.”

The members of the working group include the 4 Global Blockchain Convergence Steering committee members, Lee Schneider, General counsel at Block one, Joey Garcia, Emma Channing, General counsel at the Satis Group, Sunavna Tuteja, Head of Digital Assets, TD Ameritrade, and the Global Blockchain Convergence members Joshua Klayman, Global Tech Sector Co-Leader, U.S. Head of FinTech and Head of Blockchain and Digital Assets, Senior Counsel, Linklaters LLP, Roman Beck, Head of European Blockchain Center (University of Copenhagen), Jannah Patchay, Regulatory and Market Structure Advisor, Markets Evolution; Director of London Blockchain Foundation, Tongtong Gong, Cofounder of Amberdata, Pawel Kuskowski, Coinfirm Founder, Nicholas Philpott, Banking Market Structure expert

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