A regulatory sandbox initiated by the European Commission will allow public and private sector blockchain projects to receive guidance from regulators and legal advice from experts. Regulators, in turn, will learn about the new possibilities of blockchain technology.
The European Commission announced the launch of the European Blockchain Regulatory Sandbox (EBRS). The sandbox will provide a framework for improving legal certainty for distributed ledger technology (DLT) projects.
The sandbox will advise 20 blockchain projects from both the public and private sectors annually until 2026. Project participants will have access to regulatory guidance from EU regulators and confidential legal advice from experts at the international company Bird & Bird.
The sandbox will be available to companies that use blockchain and other distributed ledger technologies and are from the following sectors:
- energy and utilities;
- finance and insurance;
- logistics and supply chains.
Funding for the sandbox will come from the Digital Europe program. Sandbox participants will be selected on a competitive basis. The selection process will be overseen by a group of independent academic experts from European universities. To apply for the sandbox, projects must be audited for proof of concept and have a cross-border dimension. Applicants should also be based in the European Economic Area (EEA) and be registered legal entities for at least six months before applying.
To get into the EBRS top 20 blockchain projects in 2023, applications should be submitted by April 14. Selected projects will receive a written legal evaluation from national and EU regulators. Each sandbox participant will then hold two virtual meetings with regulators and law firm experts. Protocols of the virtual meetings will be available only to its participants, which will provide the necessary level of confidentiality.
Recall that the efforts of regulators are directly linked to the growing interest in blockchain innovations by business executives, who are ready to implement distributed ledger technology into their existing business processes in 2023.