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eToroX granted distributed ledger technology licence
eToroX, the digital asset subsidiary of global investment platform eToro, has been granted a distributed ledger technology (DLT) licence from the Gibraltar Financial Services Commission (GFSC).
eToroX was created in 2018 by eToro, the global multi-asset investment platform with over 10 million registered users. eToroX is responsible for defining and executing eToro’s vision around blockchain and the development of cryptoassets. It provides the evolving product range and infrastructure to support the growth of tokenized assets. Today, eToroX manages eToro’s newly launched wallet and will run the forthcoming exchange.
Commenting on the news Yoni Assia, Co-founder and CEO of eToro, said: “We believe that cryptoassets and the blockchain technology that underpins them will revolutionize global finance, bringing about the greatest transfer of wealth ever onto the blockchain. In the future all assets will be tokenized and we are just taking the first steps on this journey. Just as eToro has opened up traditional markets for investors, we want to do the same in a tokenized world and the creation of eToroX will help us do this.”
As a group, eToro has long led the way in developing a robust regulatory framework for DLT businesses and operations, including being a founding member of CryptoUK, which was the world’s first self-regulatory body for cryptoasset companies.
Yoni Assia continued: “We are proud to say that we are amongst the first companies in the world to obtain a licence for cryptoassets and one of very few regulated companies in the crypto space.”
The GFSC’s new model for licensing DLT companies sets out nine regulatory principles designed to protect users of DLT whilst encouraging innovation to flourish. The principles include requirements for licence holders to have systems in place to prevent, detect and disclose financial crime risks such as money laundering and terrorist financing, and to maintain appropriate financial and non-financial resources.
Commenting on the licence Doron Rosenblum, Managing Director of eToroX, said:
“We believe that a strong system of regulation will support the mass adoption of blockchain technology, including cryptoassets. We don’t need to reinvent the wheel to regulate blockchain. Whilst blockchain brings some unique challenges to regulators, we can protect users and help support new ideas by applying the same fundamental principles as we have in other financial markets.
“The GFSC has been forward-thinking in developing this framework and we hope it serves as a blueprint for other markets. The licence process has been thorough but by working closely with the GFSC we are pleased to say that we now have a licence and look forward to supporting the growth of tokenized assets.”
eToro acts as a bridge between the old world of investing and the new, helping investors navigate and benefit from the transition of assets to the blockchain. eToro is the only regulated brokerage service where investors can deposit fiat and then trade or invest in cryptoassets alongside more traditional assets such as stocks or commodities.
Yoni Assia added: “The launch of our wallet and the forthcoming exchange are big steps for eToro in expanding our crypto offering. With the launch of our wallet, we can for the first time provide clients with a means of transferring cryptoassets away from the eToro platform. With the eToroX wallet, customers are able to send and receive crypto via the blockchain.”
The wallet is a new product which is being rolled out on a phased basis both in terms of geographic reach and functionality.