Regulatory sandboxes and blockchain innovation

In the UK, the FCA was the first financial service regulator in 2015 to launch a sand box as part of its ‘Project Innovate’. When policymakers set up a regulatory sandbox, they make it possible for Fintech and blockchain startups to test their new ideas in a safe space with less strict rules. This usually means obtaining brief exemptions from some rules set by regulators, having regulators closely watch the product and only letting a few real customers use it. The sandbox model allows companies to work without worrying about getting into deep water for breaking strict rules, so giving them the chance to come up with new ideas and improve their products. It also helps officials learn more about new technologies, make better rules and ensure that new products are safe for customers before they are made available to more people. The company, Nivaura, used blockchain technology and, in the UK FCA sandbox, Nivaura could test its blockchain-based bond issue system - this helped improve the …