The first crypto global hub will be… Gibraltar
Blockchain firm, Valereum, has submitted a proposal to acquire the Gibraltar Stock Exchange. If that should go through, then the tiny British territory will be poised to become the first global hub for crypto trading.
The acquisition would mean that the Gibraltar Stock Exchange (GSE) would trade conventional bonds side-by-side with major cryptocurrencies like Bitcoin and Dogecoin. Such an opportunity would generate significant new global interest and investment into the GSE.
It could also mean that loosened regulations, set against an exchange that is minimally staffed, may result in an uptick in money laundering and other activities that bring the GSE into disrepute and, potentially, even lead to diplomatic sanctions for the tiny nation of 30,000-odd people.
The success of the venture would ultimately rest on the regulations set down by a body of just 82 people, and the stakes are high for a territory in which the financial sector accounts for around a third of the entire economy. However, Gibraltar has a long history of successfully flirting with the boundaries of what other nations will tolerate. Among other things, it has avoided punitive retaliation despite having a notorious reputation as a tax haven (a reputation the government is fighting hard to push back on).
Interestingly, despite Gibraltar’s apparent willingness to embrace crypto, the UK itself is far more hesitant. As recently as December this year, the Bank of England reiterated the importance of vigilance against the “financial stability risks” that cryptoassets pose. The UK advertising watchdog has banned a series crypto ads for failing to disclose the risk of investment, and in June, the UK financial regulator banned the world’s largest crypto exchange, Binance Markets.
It would seem that the UK and its client state are very much at odds on this subject.