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French regulators propose a regulatory sandbox to study security tokens in Europe.

French market regulators are considering to establish a regulatory sandbox to study the impact of security tokens in the Euro
French market regulators are considering to establish a regulatory sandbox to study the impact of security tokens in the European Union.

The Autorité des Marchés Financiers (AMF) on 6th March proposed a European Digital Lab regulatory sandbox allowing local regulators to waive requirements related to security settlements. The AMF aims to create a secure legal environment for the development of security token market infrastructure. The exemptions would be granted if the beneficiary complies with regulators and agrees to increased supervision.

The project will investigate Security Token Offerings and other blockchain-based financial instruments.

French market regulators with this project aim to investigate Security Token Offerings and other blockchain-based financial instruments. The AMF also reported that the decentralized nature of blockchain technology is a major legal obstacle to its adoption in finance. According to authorities, security token trading could be subjected to current regulation, and platforms could provide such services by applying for financial investment adviser authorizations.

The use of blockchain technology in the securities markets

Governments all over the world have embraced blockchain technology and its potential to make things more transparent. Transparency and reliability of the blockchain-based system are well-suited for managing regulated security trading. Earlier, an official at a securities regulator asked for the exploration of the best possible usage of blockchain securities markets. Earlier in March, the Eastern Caribbean Securities Exchange revealed its plans to collaborate with a digital asset marketplace providers to test STOs.

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