The UK government said it had received 19 expressions of interest from existing financial market infrastructure, banks and new entrants to participate in the first test of its digital securities sandbox. DSS will enable companies to use distributed ledger technology to simulate the operations of a central securities depository and trading venue to accommodate digital assets. The sandbox is seen as a way to test technology by making temporary changes to existing legislation, with the power to change the legislative framework as testing progresses.
HM Treasury said that after analyzing the responses, the government intended to largely retain the approach originally outlined in the consultation. This will involve establishing a broad framework for DSS in legislation and giving regulators appropriate flexibility to manage the requirements of participating entities. The government intends to include all relevant assets (except derivatives) currently within the scope of regulation into the DSS. (Finextra)
According to previous news, the United Kingdom has introduced a new regulation that allows the country’s financial regulators to operate a digital securities sandbox (DSS), allowing companies to test new solutions and products under regulatory supervision. The new regulations, which will come into effect on January 8, will enable the Financial Conduct Authority (FCA) and the central bank to operate DSS, and businesses will also test distributed ledger technology, which supports cryptography to digitize or tokenize traditional securities.