The UK’s oldest cryptocurrency exchange, Coinfloor, has been the first to be awarded a full Distributed Ledger Technology Licence in Gibraltar.
The awarding of the licence by the Gibraltar Financial Services Commission follows the completion of a rigorous “nine principles” application process.
This licence authorises Coinfloor to store or transmit value belonging to others using blockchain technology.
The exchange has a three-strong team trading in Gibraltar, and Coinfloor CEO Obi Nwuso is optimistic about doing business on the Rock.
In an interview with the Financial times, Mr Nwosu said: “What impressed us was that this [legislation] was in the works for a long time.”
“It has been well thought out, well considered. [Gibraltar] is focusing in on quality over quantity.”
Coinfloor is now fully compliant with Gibraltar’s DLT legislation, which is a purpose-built legislative framework for businesses that use blockchain or DLT, introduced in January of this year.
The Minister for Commerce, Albert Isola, said: “We have championed internationally compliant, robust, and sensible legislation to regulate this revolutionary technology in Gibraltar while simultaneously striving to maintain the conditions that encourage further private sector innovation.”
“This announcement is another positive development which shows that Gibraltar is open for business and ready to work with quality companies to provide a regulated road to market.”
The principles-led approach allows businesses to engage with regulators in a robust and speedy manner while also providing the flexibility required for guidelines to evolve in tandem with the fast moving nature of blockchain technology.
Founded with a focus on trust, security and reliability, Coinfloor’s goal has always been to create a safe and accessible place to trade and invest in bitcoin.
Coinfloor’s history goes back to 2012 when they experienced first-hand the challenges of buying, selling and trading bitcoins in the UK, and wanted to build a business that solved this problem.
Following the introduction of Gibraltar’s DLT legislation, businesses were invited to engage with the GFSC to discuss whether proposed activities would require licencing.
Once this was established, submissions were then subject to an initial risk assessment by the GFSC.
The process also involved applicants making an in-person presentation to the GFSC, outlining a comprehensive business plan and details of how they planned to meet the nine regulatory principles.
“Our congratulations to the team at Coinfloor on the granting of their DLT licence which is very much part of the next logical step in our journey towards making Gibraltar a world-class destination for blockchain companies,” Mr Isola added.
“The licence approval process has been underpinned by the principles-based regulatory framework for DLT and I believe it will set the standard for customer experience in this space while providing opportunity for innovators to develop further.”