Several known crypto companies have been granted licenses to operate from Gibraltar since the British overseas territory adopted business-friendly regulations for the nascent industry. According to Gibraltar’s trade minister, Albert Isola, the government is now focused on creating a “supportive environment” for the sector.
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Supportive Environment for the Crypto Industry
The Digital Ledger Technology (DLT) Regulatory Framework went into effect in January 2018, a month after it was approved by the Legislature of Gibraltar. The regulations are designed to attract companies from the cryptocurrency and blockchain industry while ensuring proper protection for customers’ interests and maintaining Gibraltar’s own reputation, according to the authors of the dedicated legislation.
“Our financial regulator, the Gibraltar Financial Services Commission (GFSC), began awarding DLT licenses to a number of leading blockchain firms operating here in October,” the Minister for Commerce of Gibraltar Albert Isola told news.Bitcon.com. The list of licensed companies includes Huobi, the fourth largest exchange by daily trading volume, Coinfloor, the oldest crypto trading platform in the U.K., Covesting, which is another crypto exchange based in Europe, the Gibraltar Blockchain Exchange (GBX), operated by the local stock exchange, and the most recently licensed entity, digital asset platform Etorox.
Isola, who is also a member of the British parliament, emphasized that the regulatory framework implemented in Gibraltar is designed to remain flexible to the fast-moving developments of the wider crypto ecosystem and will allow authorities to react swiftly to the growth of the sector in the coming years. The official added that while introducing sensible legislation has been the main priority, the government has been also working to create a supportive and business-friendly environment for blockchain companies that want to operate there or have already established a presence in the territory.
The trade minister shared that Gibraltar has recently established a trade association for the industry, the Gibraltar Association for New Technologies (GANT). The organization facilitates the development of formal relationships between the authorities and the crypto companies. The government has also created a working group called New Technologies in Education (NTiE). The project, a joint initiative between the executive power, the private sector, and the University of Gibraltar, aims to address the growing demand for related skills. The plan is to organize educational courses that will prepare employees and specialists for the industry.
Gibraltar and the Competition
Gibraltar is one of several jurisdictions in Europe that have taken steps to become crypto-friendly territories. These include Switzerland, Malta, Estonia, and the Isle of Man. Switzerland, which is home to the Crypto Valley in Zug, has attracted hundreds of crypto startups. The Swiss government recently announced a comprehensive strategy that recognizes distributed ledger technologies as an important development for the financial sector and aims to build a legal foundation for their implementation. Last year, Malta adopted a welcoming regulatory framework for crypto businesses, and Estonia has licensed over 900 exchanges and wallet service providers in less than a year since it introduced a licensing regime for crypto companies.
Albert Isola believes, however, that Gibraltar remains the destination of choice for quality fintech companies because of its “reputation for being a business-friendly jurisdiction, for promoting blockchain education and for strong public-private sector collaboration.” The government representative noted that the local authorities are focused on creating legislation that will provide strong oversight and consumer protection without stifling the innovation which is required for the industry to flourish. He also added:
We want to create a vibrant DLT community in Gibraltar by developing strong, collaborative relationships with the private sector operators who have based themselves here.
Gibraltar has long been a hub for businesses providing financial services and companies operating online gaming platforms. These two sectors provide a sizable portion of its domestic product and budget receipts. The Gibraltar government has been quick to realize the potential benefits of building a crypto-friendly environment and expects that its regulatory framework will attract more crypto companies in the future.
What are your expectations about the future of the crypto industry in Gibraltar? Tell us in the comments section below.
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