Under the proposals, approved sandbox participants would be able to operate a trading platform or provide securities depository and settlement services, under the amended regulations, including the ability to provide these experimental services within a single legal entity for the first time.

“The adoption of new technologies in this area, if done safely, could lead to a technological transformation that will promote greater efficiency as well as greater resilience of the financial system in the long term,” the regulators said. The proposed sandbox “represents an important step in exploring innovation in digital assets in the UK and could lead to faster and cheaper ways for participants in financial markets to trade, settle and use these securities.

The amended regime, which will also limit activity in the sandbox to protect financial stability, will apply for five years and could lead to a new permanent regulatory regime for securities settlement.

“The new digital securities sandbox is reshaping the way we regulate by allowing companies to test regulatory changes using real-world situations before those changes become permanent,” says Sheldon Mills, CEO of Consumer & Competition. of the FCA, in a press release.

“We hope this will be a more efficient, more collaborative and faster way to advance the regulations,” he adds.

In addition to the consultation document, regulators published draft guidelines for companies considering entering the sandbox.

The consultation is open until May 29.

Regulators aim to finalize their approach and open the sandbox over the summer.