Blockchain Framework Bill Passed by Luxembourg Parliament

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Blockchain Framework Bill Passed by Luxembourg Parliament

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Bill 7363 has been passed into law by lawmakers in Luxembourg. The said bill will facilitate the utilization of blockchain technology in financial services, according to the office of the parliament in a report published on 14 February 2019.

In regard to the circulation of securities using blockchain technology, more legal certainty and transparency will be provided to financial market participants, notes the bill. Moreover, by reducing the number of intermediaries, more efficient transfer of securities will be possible after the implementation of the new bill.

The same level of protection and legal status will now be given to the transactions done via blockchain as is given to the ones done via traditional means. Reportedly, only 2 of the 60 parliamentarians voted against the bill.

Recently, Luxembourg has shown a positive attitude towards blockchain technology. In order to improve the security level of digital assets, trading platform VNX Exchange (based in Luxembourg) joined hands with the University of Luxembourg in November 2019. In the said project, VNX will be helped by the University of Luxembourg to come up with digital assets having high levels of network security.

In March 2018, the Luxembourg Financial Regulator CSSF issued a warning against investments in initial coin offerings and cryptocurrencies, citing the “incomprehensible” business models governing the crypto sector. It also stated that digital assets were not supported by any central bank and warned potential investors against the volatile nature of cryptocurrencies.

In June, research company Ipsos reported that Luxembourg has the lowest rate of masses when it comes to owning digital currencies. The study was conducted on the request of Netherland’s ING Bank. The said study might have influenced Luxembourg’s government to come up with regulations.

 

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