In April 2017 The FCA announced that it was seeking stakeholder views on the potential for future development of Distributed Ledger Technology (DLT) in the markets the FCA regulates.
The FCA received 47 responses from a wide range of market participants including regulated firms, national and international trade associations, technology providers, law firms and consultancies.
DLT has come to greater public prominence as it underpins digital currencies such as Bitcoin. This paper is not about Bitcoin or other so-called cryptocurrencies. Rather its remit is to consider the range of ways that DLT can impact on financial services and the regulatory implications.
Respondents expressed particular support for the FCA maintaining a 'technology-neutral' approach to regulation and welcomed the FCA’s open and proactive approach to new technology, including our Sandbox and RegTech initiatives.
The feedback also suggested that current FCA rules are flexible enough to accommodate the use of DLT by regulated firms and no changes to specific rules were proposed. Many respondents suggested that DLT solutions could deliver regulatory requirements more efficiently than current systems, substantially reducing costs for firms and regulators alike.
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