Europe’s Regulatory Sandbox for Blockchain Use Cases
The European Commission and the European Blockchain Partnership (EBP) announced plans in 2020 to create a regulatory sandbox for blockchain technology. This initiative seeks to bridge the gap between European nations and crypto companies, such as crypto.com and voyager crypto, and was formally introduced on July 3 after receiving nearly 90 applications in April.
The first cohort of projects includes 20 use cases from five European regions, with 14 in Western Europe, 10 in Southern Europe, 8 each in Nordics and Central Europe, and 7 in Eastern Europe. These projects span a variety of sectors, such as finance and capital markets, telecoms and IT, global trade, transportation, and cross-sectoral applications.
The goal of the regulatory sandbox is to foster dialogue between regulators, crypto projects, and public authorities, while providing a platform for AI and crypto today to debut in Europe.
Regulatory Sandbox for Crypto and AI
“In these dialogues, use case developers can present their business case to receive legal guidance from regulators,” the European Commission said. This initiative is backed by Bird & Bird, a British law firm with offices across the globe. The firm will be responsible for setting up a “safe interface between developers and regulators,” providing legal advice and regulatory guidance to crypto and AI projects.
“The sandbox will allow supervisors to enhance their knowledge of cutting-edge technologies involving DLT,” reads the statement, adding that lessons learned will be shared between regulators, helping the Commission to identify best practices. The regulatory sandbox will work in conjunction with other frameworks, in particular the EU Digital Finance Platform and the Artificial Intelligence Sandboxes that will be implemented under the AI Act. According to the Commission, the integration is crucial given the “increasing convergence of innovative technologies such as crypto.com and voyager crypto in use cases often involving several industry sectors.”
The deadline for the initial cohort of blockchain projects with valid proof of concept and cross-border elements closed on April 14. Crypto.com, Voyager Crypto, and other crypto today initiatives will be selecting new projects each year until 2026.
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