LEGISLATION governing the exchange of tokenised digital assets is being finalised by the Gibraltarian government and the Gibraltarian Financial Services Commission (GFSC).

The government had announced that its position on tokenised digital assets, known as tokens, would be concluded by this month.

Tokenised digital assets are created when physical or intellectual assets are traded online.
They typically use distributed ledger technology (DLT), meaning any exchange is anonymous and incorruptible.

“This government successfully delivered DLT Regulations that came into effect in early January 2018,” said Minister of Financial Services, Albert Isola.

“I announced last year that we would introduce complimentary yet distinct legislation covering token sales and have asked the GFSC to complete this work-stream at the earliest opportunity.

“We remain fully committed to ensuring that we protect consumers and the reputation of our jurisdiction.

“In addition, we are also conscious of providing safeguards to those firms that have chosen Gibraltar as their home.”

The government has indicated that regulation will cover the promotion, sale and distribution of all tokens by people connected with Gibraltar.

It will also cover ‘secondary market activities related to tokens’ and the provision of investment advice related to the token industry.

It is hoped the rules will detect and prevent financial crime associated with DLT, such as money laundering and terrorist financing.

A bill is expected to be considered by Parliament in the second quarter of 2018.