SEC’s Hester Peirce urges US-UK Digital Securities Sandbox Cooperation

Hester Peirce, the US Securities and Exchange Commissioner, is advocating for the establishment of a collaborative digital securities sandbox between the United States and the Bank of England. This will enable companies to experiment with inventive finance equipment within a controlled space. 

The sandbox will offer businesses connectivity with multiple technologies, such as distributed ledger technology (DLT) and others. 

Peirce is inclined toward the cryptocurrency community and finds the initiative encouraging for experimenting with DLT to determine whether it is actually beneficial in matters pertaining to the issue, trade  and settlement of securities, while also protecting the interests of investors and the markets and achieving financial equilibrium.

In the UK and other regions, historical evidence has demonstrated the beneficial role sandboxes play in enabling innovators to test their innovative ideas in real-time and practical scenarios. It allows smaller businesses to enter certified markets and participate in the competitive rat race.

Businesses that establish connections with the sandbox will have the opportunity to specify specific regulations for their operations. Before setting it out for a larger audience, each stage of experimentation can be conducted in the laboratory.

The SEC is of the opinion that the laboratory should be accessible to all, with specific entry requirements. They believe that participants should be permitted to participate for a maximum of two years.

In the meantime, the SEC’s FinHub will assist businesses in forwarding their participating applications, provided they receive the required consent for their experiments. All the information thereafter will be in the public domain.