Regulatory Sandbox
Definition
A framework set up by a regulator that allows fintech startups and other innovators to conduct live experiments in a controlled environment under the regulator's supervision, with specific regulatory relaxations. Sandboxes enable regulators to better understand emerging technologies while providing firms with a pathway to authorisation.
Regulatory Context
The FCA launched the first regulatory sandbox in 2016, and the concept has been adopted by over 50 jurisdictions worldwide. The EU has established a pan-European regulatory sandbox for DLT market infrastructure under the DLT Pilot Regime.