The Gibraltar Stock Exchange (GSX) is preparing for a corporate takeover that could have global consequences for the country. While countries including China and the UK have either banned or openly warned against investments in cryptocurrency assets, Gibraltar however is aiming to formally regulate cryptocurrencies in an attempt to future-proof the territory’s status as a financial hub.
It comes as Gibraltar struggles to lose it's reputation as a global tax haven, with the government having sued a Spanish newspaper in an attempt to restore its global standing. The British overseas territory is reviewing a proposal for blockchain firm Valereum to acquire the Gibraltar Stock Exchange, which would allow the territory to serve as a platform to trade Bitcoin and Dogecoin alongside traditional bonds, according to newspaper The Guardian.
Albert Isola, Gibraltar’s minister for digital, financial services and public utilities says that while Gibraltar was indeed a tax haven 20 years ago, the territory has now overhauled its tax and information sharing policies. The introduction of cryptocurrency regulation is having a similar effect: rooting out the bad actors and providing assurance to investors, he says.
The country of Gibraltar insists that it has welcomed crypto firms with its eyes wide open, having consulted on its regulation for the sector for four years before introducing it in 2018, helping it to secure a reputation as "Blockchain Rock". By filtering through and licensing firms, says Isola, they weed out bad actors.
"I don’t understand how there can be any increased risk in Gibraltar, when you can go to any other European country today and run exactly the same business without being supervised, without being licensed, and without being regulated. So how can we be more exposed by regulating them? It’s completely the opposite," Isola says.
The news comes amid concern at major global financial regulators, including the Bank of England, over the rapid development of cryptocurrency assets and the potential consequences for consumer and investor protection, market integrity, money laundering and the financing of terror groups.
All of this is just the latest indication of the huge rise in prominence and influence of cryptocurrency around the world, with Bitcoin, Ether and Dogecoin, among many other cryptocurrencies, seeing an explosion of value over the last two years.
Sources:
https://www.theguardian.com/technology/2021/dec/27/blockchain-rock-gibraltar-moves-to-become-worlds-first-cryptocurrency-hub
https://www.cnet.com/personal-finance/crypto/gibraltar-poised-to-become-first-cryptocurrency-hub/
https://ambcrypto.com/will-gibraltars-move-to-become-a-crypto-hub-further-its-tax-haven-image/