The European Commission (EC), the executive body of the European Union (EU), has started a regulatory sandbox to test use cases of blockchain technologies and provide legal clarity for the industry, according to a Tuesday press release.
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- Run by independent academic experts, the project is expected to run for the next three years and to support up to 20 private and public sector projects seeking to innovate and build blockchain infrastructure.
- While pilot programs conducted in the EU have shown the potential of blockchain, such as protecting against counterfeiting in supply chains and reducing the cost of trading securities, the EC points to legal uncertainty still in the space.
- One goal of the sandbox is to facilitate the cross-border dialogue between regulators and blockchain-related companies, helping the EC identify best industry practices.
- The sandbox will also work with other relevant sandboxing frameworks, particularly those related to digital finance and artificial intelligence.
- Projects will be selected through calls for expression of interest, with initial applications accepted until Apr. 14.
- Since last year, the European Union has worked to create a new legal framework for the crypto industry to strengthen standards and requirements for digital asset-related business.