Ambar Vitelli-Khosla
Strategic Partnerships
Andreessen Horowitz (a16z) chooses London as the site for their first office outside the US, praising the role of Digital Sandboxes in UK regulation ‘The U.K. is on the right path to becoming a leader in crypto regulation’ (a16z).
A16z has recognised the following approaches adopted by the UK Government as specific to blockchain and digital asset regulation:
- Working constructively with industry to identify the unique attributes of blockchain technology and how those attributes shape the risk profile of decentralised services vs. centralised services.
- Laying the foundation for future applications of blockchain technology.
- Putting forth an innovative sandbox approach to regulation.
- Focusing on an outcomes-based approach.
- All the while continuing to keep consumer protection front-and-center of any regulation.
- This news comes with an investment in UK based AI company Gensyn the latest in a number UK-based crypto companies including Arweave, Aztec, and Improbable in a16z’s portfolio.
The FCA leveraged the Digital Sandbox to run a crypto sprint in 2022. The main aim of the event was to increase our understanding of emerging crypto asset market practices and to seek views from the industry on what an appropriate regulatory regime might look like. The outcome was workstreams to further understand what future crypto standards and requirements may mean for other areas, like:
- Environmental social and governance (ESG) considerations
- Redress
- Market conduct
- Operational resilience
- and insolvency
The conversations following the Crypto Sprint have inspired UK Finance to undertake further work in this area and focused on an approach to tiered regulation for crypto assets for financial services. UK Finance has also set up governance structures on central bank digital currencies (CBDCs), stablecoins, and crypto assets representing a diverse base of members across the financial landscape.
