According to an official statement released on December 18th, the United Kingdom has introduced new regulations that will provide rules for overseeing a digital space for tokenized securities. These regulations will be applicable to the United Kingdom’s Digital Securities Sandbox (DSS) and will come into effect on January 8, 2024.
This process is part of the UK government’s 2023 Financial Services and Markets Act (FSMA). The new rules highlight general restrictions on what can be done in the digital space and who can participate in this process.
In the digital space, companies and legal regulators will be able to test solutions, including distributed ledger technology and the tokenization of securities. The UK Treasury announced that the new regulations will be jointly overseen by the Bank of England and the Financial Conduct Authority (FCA).
In the budget announcement made by UK Chancellor of the Exchequer Jeremy Hunt in November, he mentioned a new government initiative that will facilitate the expansion of the crypto asset sector in the UK. Hunt announced that the Digital Securities Sandbox would be implemented to ease the adoption of crypto assets in financial markets.
The UK continues to attract attention with its legal regulations for the crypto market. However, the strict criteria set for crypto companies in the process are causing many companies to cease their operations in these countries.