Coinfloor, the UK’s first cryptocurrency exchange, is now also the first recipient of a Gibraltar blockchain licence, according to the Financial Times.
The development follows an in-principle licence being awarded in August. CEO Obi Nwosu said: “What impressed us was that this was in the works for a long time. It’s been well thought out, well considered. They are focusing in on quality over quantity.”
Well Thought-Out, Well-Considered
The law in Gibraltar requires that blockchain companies conform to nine regulatory principles, a charter that came into practice on the first day of 2018. These principles include that companies conduct their business with honesty and integrity, that they communicate fully with their customers, and that they have fraud prevention systems in place.
Gibraltar was the first territory in the EU, and one of the first in the world, to regulate cryptocurrency. To the Gibraltan authorities, the move was a way to attract “quality firms” to the territory, but one result of the law’s passing was the Royal Bank of Scotland immediately cutting off banking services to Gibraltar International Bank.
In March 2018, the Gibraltar Financial Services Commission took a further step when it proposed laws to cover initial coin offerings. These fundraising campaigns have been a thorn in the side of regulators worldwide for over a year now, as people have been pouring millions (and sometimes billions) of dollars into projects which are scams more often than not.
The GFSC suggested a system of authorised sponsors, who once approved will liaise between the project and the GFSC. Running an ICO without authorisation constitutes a criminal offence.
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London-based Coinfloor was established in 2013. It has traded just under $2 million in cryptocurrency transactions in the last 24 hours, according to coinmarketcap.com, so it is a fairly small-scale operation while being one of the longest-established. It was forced to cut an undisclosed number of jobs earlier this month because of the loss of value in the cryptocurrency market, according to Bloomberg.
In March, the company announced its intention to sell futures based on the price of Bitcoin, following the example of two derivatives exchanges in the US. Coinfloor’s product differed in that the bitcoins are actually delivered at the end of the contract, as opposed to being based on a theoretical transaction. The contracts are sold from a venue set up for that purpose – CoinfloorEx.
In June, Nwosu argued for cryptocurrency at a committee meeting held by the UK Treasury.
In November, he will be hosting a session at the Finance Magnates London Summit.
— Finance Magnates (@financemagnates) October 2, 2018