The UK continues to embrace emerging tech and blockchain technology as the Financial Conduct Authority (FCA) permanently launches a Digital Sandbox.
The digital world will be made available to businesses, startups and small and medium businesses (SMEs) on 1 August with the aim to create an environment to foster innovation through advanced and emerging technologies.
This follows the FCA and the UK Treasury confirming the successful passing of two Digital Sandbox pilots as part of the country’s continued efforts to become a global hub for blockchain and digital asset innovation through the passing of the Financial Services and Markets 2023 act.
The Digital Sandbox will welcome businesses in the early stages of their product developments to its testing environment through proof of concept experiments, as well as data providers to list their data to gain enhanced traffic and insights.
Further Digital Sandbox features include:
- Robust data security protection: for integrated the development of the environment and to allow experimentations to flourish whilst safeguarding data and digital assets on the platform
- High-quality datasets and APIs: this includes over 200 synthetic, public or anonymised data sets and over 1,000 APIs to enable testing and validation of technology solutions from a range of payments, social media, investment and credit data
- An observation deck: this enables interested businesses to observe in-flight tests at a technical level
The virtual world has only been temporarily available to firms piloting and TechSprints – an initiative that brings together non-financial entities to discuss best practices to address challenges within the industry.
More than half of the previous SME participants in the pilots and TechSprints made positive developments including launching new products, securing funding and partnerships, or receiving industry awards or recognitions.
The launch of the Digital Sandbox is enabled by the passing of the Financial Services and Markets 2023 act, which also gave the green light for cryptocurrencies to be recognised as financial instruments in the country, accelerating the UK’s blockchain ambitions.
A Treasury statement read: “(The Digital Sandbox Service) will be the first financial market infrastructure sandbox delivered under the powers granted as part of the Financial Services and Markets Act 2023.
“The DSS will facilitate the testing and adoption of digital securities across financial markets. Through the DSS, industry will be able to set up financial market infrastructures that utilise digital asset technology, which can perform a number of activities in relation to digital securities under a temporarily modified legislative and regulatory framework.”
