Gibraltar, one of the few crypto-friendly jurisdictions, is set to bring new laws to curb cryptocurrency market manipulation.
In an interview with The Banker, Albert Isola, Gibraltar’s minister for digital and financial services, revealed that the jurisdiction is now trying to regulate the crypto industry in the likes of a financial services sector, rather than regulating crypto assets as a whole.
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Gibraltar became one of the first jurisdictions to bring blockchain guidelines in early 2018, and now aiming to bring the market manipulation guidelines in the “next few months.”
The modified crypto guidelines of 2018 spanned nine core principles, including corporate governance, fitness and propriety, capital adequacy, and security arrangements.
“We considered regulating crypto assets, but concluded that it was too challenging to do it safely,” Isola said. “Therefore, we opted for regulating this space in a more financial services-based way, which became what we called the core principles.”
He also pointed out that the authorities’ decision to move its focus on the sector is also fueled by the declining demand for initial coin offerings (ICO) in the last couple of years.
The jurisdiction is also focusing on implementing the Financial Action Task Force’s (FATF) guidelines for monitoring cross-border financial activities.
“In the FATF review published in 2019, we were particularly interested in Recommendation 16, also known as the Travel Rule,” he added. “We are developing a technology solution to ensure our firms can collect client information when they are transferring money, as in traditional banking environments.”
The minister also revealed that 15 blockchain companies are operating under its crypto licensing framework.
“They are subject to the same supervisory regimes as banks or financial services firms, such as on-site inspections and AML process assessment,” Isola said.