London-based crypto exchange Coinfloor has announced that its spot exchange in Gibraltar has received an in-principle license by the Gibraltar government.
According to an official statement from the company to Finance Magnates, Coinfloor has earned an in-principle license as a DLT (distributed ledger technology) provider under the Financial Services (Distributed Ledger Technologies Providers) Regulations 2018, the territory’s DLT regulatory framework.
Gibraltar’s framework was originally introduced in January of this year, and was lauded as an important milestone for the global cryptocurrency industry. The territory was one of the first jurisdictions in the world to allow cryptocurrency firms to receive licensure. “The framework is a strong example of a flexible, adaptive approach which supports innovative business models through the application of principles, rather than rigid rules,” said the statement.
Coinfloor: Gibraltar is a Regulatory Leader
Gibraltar’s relatively early introduction of a legal framework for cryptocurrency was a significant part of the territory’s bid to become a hub for the global crypto industry. Indeed, a number of small countries with small and agile governments have had the opportunity to make fast moves toward providing adequate regulations for the crypto space, including Malta and Luxembourg.
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Coinfloor CEO Obi Nwasu believes that the tiny jurisdiction is setting an active example for its presiding nation, the UK. “Following Gibraltar’s lead, we believe the UK Government should consider giving the FCA the necessary powers to regulate cryptocurrency platforms, ensuring that any regime that is introduced drives consumer confidence whilst enabling innovation,” Nwasu said in a statement.
Industry Participants Must “Work Closely” With Policy Makers
Nwasu also believes that it is the industry participants who hold a responsibility to educate the world’s governments about how best to regulate the industry in a way that supports innovation and protects investors, without stifling growth.
“It’s important that we work closely with policy makers to help define the appropriate and balanced regulatory frameworks which will promote good practices whilst enabling the crypto asset industry to grow and bring long-term benefits to consumers, businesses and Government, including increased potential for financial inclusion, job creation, and economic investment to the country,” he explained.
The in-principle authorisation comes several weeks after Coinfloor announced the launch of physically delivered BTC futures contracts. Along with regulation, Coinfloor co-founder Mark Lamb believes that the physical contracts will invite more institutional cash into the crypto investment space. Together, these forces will benefit the entire crypto industry.
“As trust builds and institutions become more familiar to with the crypto industry, we expect to see volumes move over, given the increased levels of certainty and reduced trading risk,” said Lamb in an exclusive interview with Finance Magnates.