Experimenting With DLT: A Comparison Between the EU DLT Pilot Regime Regulation and the UK Digital Securities Sandbox

ABSTRACT

This article provides a comprehensive comparison between the European DLT Pilot Regime Regulation and the UK Digital Securities Sandbox (DSS), both of which have the intention for market infrastructures to experiment with the distributed ledger technology (DLT). The UK DSS provides more flexible powers to the UK authorities and appears broader in scope in terms of participants that can enter the sandbox, the type of technology one can experiment with, the type of activities that can be offered, the type of financial securities one can experiment with, and the limits participants are subject to. Yet, the UK DSS is in general not less stringent than the EU DLT Pilot Regime as no deregulation is foreseen in the UK DSS for trading venues that want to experiment with the technology. In addition, in contrast to the EU DLT Pilot Regime, the United Kingdom foresees a structured approach with “stages” and “gates” to be passed to continue the experimentation.