Malta Gaming Authority Begins Testing of Cryptocurrency Sandbox FrameworkPublished January 14, 2019 by Mike P
In 2019, the Malta Gaming Authority will embark on a rigorous testing process to enhance the security of crypto and other digital currencies.
The Malta Gaming Authority (MGA) began 2019 by revealing that the jurisdictional licensing body has launched phase one of the Sandbox Framework, which specifically relates to the processing and tracking of cryptocurrencies, along with distributed leger technology (DLT) and virtual financial assets (VFA).
Framework Now Accepting Applicants
As of 3 January 2019, it was revealed that current MGA license holders would be permitted to submit applications to utilise the Sandbox Framework. Existing operators can commence an application through the updated Licensee Relationship Manage System (LRMS), an online portal that is provided by the MGA.
Once approved, operators will have the ability to use the existing Player Funds Report to present data relating to players’ VFA spending. Fundamentally, the Player Funds Report is used to collate spending data on a monthly basis.
Phase one of the Sandbox Framework is initially scheduled to run for 10 months, but could be extended, and will then later be followed by a second phase. Throughout the first phase, the MGA will use the Sandbox Framework in order to perform rigorous testing into the transactions of digital currencies.
Identifying and Negating Risks
MGA licensees that are approved to enter the Sandbox Framework will be given the ability to test out the processing digital currencies within an environment that is closely controlled. Ultimately, this will enable Malta’s regulator to gauge if there are any risks associated with the process.
A number of early risks have already been cited as potential concerns, with the authority eager to ensure consumer are protected. Beyond that, the authority will also evaluate any implications that are related to organised crime and terrorism, with money laundering being a possible risk.
Fundamentally, the MGA is seeking to use the two phases of the Sandbox Framework as a means of figuring out how to process cryptocurrencies, DLT, and VFA – all while negating the issues that can arise from the technology.