An action plan to combat market manipulation and unlawful trading activities has been launched by Gibraltar’s main regulatory agency, GFSC (Gibraltar Financial Services Commission). A group of government officials and industry stakeholders have collaborated to design new regulatory procedures. Furthermore, Gibraltar’s government has approved new legislation for blockchain firms aimed at countering unlawful financial practices such as market manipulation and insider trading. The measures are to take effect immediately.
Regulation Against Insider Trading And Market Manipulation
The regulatory watchdog, GFSC is indeed determined to ensure the local cryptocurrency economy continues to develop while remaining compliant with global financial rules. To begin with, the nation’s Minister of Digital and Financial Services, Albert Isola, stated in 2020 that meddling with asset values was a severe threat to the expansion of the nation’s digital economy.
Also, the minister noted that a secure marker environment must back blockchain technological advancements. In response to questions on the most recent regulatory framework, the Isola stated that:
“Our regulatory system will be further developed due to the implementation of the tenth Principle, which was developed with extensive input from the industry. Additionally, it offers consumer and also jurisdictional protection by giving explicit guidelines on the requirements that businesses must meet before they are allowed to operate in the region.”
The Tenth Regulatory Principle
The Tenth Regulatory Principle, which was released on the 27th of April, 2022, stated that blockchain enterprises and DLT service providers must implement adequate measures to prevent insider trading and asset manipulation to ensure fairness and equity.
The most recent recommendations issued by the GFSC indicate that corporations are obligated to register transactions involving large sums of virtual currencies to the agency. As an additional point of clarification, the policy package states that providers of DLT services are in charge of handling information on market situations and trade volume statistics.
Notably, the recommendations placed a strong emphasis on countering erroneous information and ensuring the integrity of the crypto marketplace is not compromised. Following the release of the new rules, joey Garcia, financial counselor, expressed his appreciation to the government for their initiative. Garcia stated that:
“It is encouraging to see the region taking the lead in creating standards, especially in light of the FATF’s recent recommendation that governments should take note of market needs and integrity when formulating a regulatory framework for the area.”
Gibraltar’s Developing Cryptocurrency Scene
Over the last years, the overseas territory of the UK has purportedly enacted crypto-friendly legislation to attract international investment and assist local blockchain-based firms. In 2017, the government launched a cryptocurrency licensing framework for distributed ledger technology (DLT) firms.
Following China’s crackdown on crypto assets, according to sources from Bloomberg, the territory apparently permitted Huobi’s transfer of its spot trade capabilities to its local subsidiary, which was previously denied.