The Maltese Gaming Authority (MGA) has launched the first of its two-phase Sandbox Framework for the acceptance of Virtual Financial Assets (VFA) and the use of Distributed Ledger Technology (DLT) within the gaming industry.
During the initial phase, the MGA will accept applications for the use of DLT Assets, directly or via third party service providers, by its respective licensees.
The approval to participate in the Sandbox Framework is conditional on applicants possessing the correct licencing issued by the MGA.
When announcing the new framework back in October 2018, MGA chief executive Heathcliff Farrugia commented: “The MGA’s strategic mission is to be at the forefront of gaming regulation whilst embracing innovation.
“This, coupled with the rapid rise in interest from gaming operators to incorporate VFAs and DLT into their operations, were the main drivers behind the proactive approach taken by the Authority to issue a Sandbox Framework for the use of these technologies within a controlled regulatory environment.”
The new initiative is expected to run until October this year, but if fit for purpose, may be subject to an extension by the MGA.
Farrugia added: “This Framework is intended as a live document and will therefore be subject to feedback and potential updates during its duration, whilst also keeping in consideration any technological or regulatory developments which may occur.”
MGA also updated its Licensee Relationship Management System (LMRS) to allow new operators to apply for approvals for the use of DLT assets as part of a new licence application; existing licensees to apply for approvals for the use of DLT assets; and existing licensees participating in the sandbox environment to report VFA player liabilities through the monthly player funds report.
The framework comes as a follow-up to the Maltese Parliament’s decision to revamp its gambling laws in 2018. It set out new rules broadening the regulatory scope to increase the MGA’s oversight and to allow, in a proportionate manner, intervention where necessary.