UK Regulators Publish Draft Guidance on Digital Securities Sandbox Open to DLT
The Bank of England (BoE) and the Financial Conduct Authority (FCA) have initiated a consultation on draft guidance for a digital securities sandbox. This sandbox is intended to allow testing of distributed ledger technology (DLT) in financial services. The sandbox, which is expected to run for five years, could lead to a new regulatory framework for securities settlement. Successful applicants will be able to offer securities depository and settlement services and operate a trading venue under modified regulations. They will also be able to use DLT in the trading and settlement of digital securities like shares and bonds. The consultation will run until May 29, with final guidance and application processing planned for the end of the second quarter.
