GFIN cross-border testing pilot – next steps

We announce the next steps as part of the Global Financial Innovation Network (GFIN or Network) cross-border testing pilot.

In total, 44 unique applications were submitted across the 17 participating regulators. Every regulator participating in the pilot was the subject of at least one application. Each regulator has considered whether a proposed test meets its individual screening criteria, areas of interest, and they have considered their ability to support the activity.

After this initial screening, GFIN members will continue working with 8 firms. The next phase is for the firms to develop testing plans with the relevant regulators for their cross-border trial, some of which will involve live transactions. Firms that develop a testing plan satisfactory to each jurisdiction’s criteria will take part in the pilot testing phase.

This announcement is not a render of indicative regulatory approvals or a guarantee that each firm will undertake a test. Rather, it is conditional on further work being undertaken and tests being agreed by the regulators involved. An announcement of the firms formally selected for the cross-border testing pilot will be made in late Q2.

A high number of applications were from firms with RegTech and cryptoasset related business models. While we hope to receive further applications related to these areas in the future, it is also our hope and ambition to receive applications from other areas of financial services.

Of those applications that did not meet the eligibility criteria for testing, GFIN members will engage in further discussions on other types of potential support where relevant. Also, several applications have been determined by some regulators to not need sandbox in their jurisdictions to proceed to testing.

GFIN is keen to explore how these pilot tests will function and welcomes feedback from applicants to help inform and enhance its approach.

Regulators are only responsible for those applications relevant to them, as highlighted in the table below. The following tests are under consideration for the cross-border trials:

Firm

Proposed test

Regulators involved

Alphapoint Software company offering products built on public and private blockchains that support the requirements for issuance, custody and trading of digital assets with liquidity across multiple exchanges. Bermuda Monetary Authority (BMA), Bank of Lithuania (LB)
Ascent RegTech AI-driven RegTech solution that automatically maps a customer’s specific regulatory obligations and ongoing rule changes, while also enabling end-to-end compliance management. The product helps firms see similarities and differences in regulatory obligations across regulators and countries. Australian Securities & Investments Commission (ASIC), Autorité des marchés financiers (AMF Québec), Dubai Financial Services Authority (DFSA), Financial Conduct Authority (FCA), Hong Kong Monetary Authority (HKMA), Ontario Securities Commission (OSC)
ATLANT Digital securities platform offering primary issuance of digital shares & debentures, secondary trading and optimized post-trade, with automatic clearing, settlement and custody. Central Bank of Bahrain (CBB), Monetary Authority of Singapore (MAS), Jersey Financial Services Commission (JFSC), LB​​​​​​​
Coinvestion​​​​​​​ Platform that uses blockchain to allow users to invest in real estate shares as securities and develops fractional ownership schemes. British Columbia Securities Commission (BCSC), BMA, JFSC, LB, MAS​​​​​​​
DACX Platform that uses DLT and machine learning to facilitate cross-border transactions of multi-currency payments, assets and commodities via tokenisation, smart contracts and escrows. Astana Financial Services Authority (AFSA), plus others to be confirmed​​​​​​​
Onfido​​​​​​​ A technology provider that has developed a proposition to allow consumers to securely control their verified identity Digital ID and share/transfer that verified identity across financial services organisations for the purposes of KYC checks. HKMA, FCA, LB, OSC​​​​​​​
Starling Trust Applied behavioural sciences technology company that has developed a Predictive Behavioural Analytics platform using machine learning and electronic communications data to allow users to measure, manage and mitigate culture and conduct risks. They will be partnering with a select group of global banks, with an initial focus on the three lines of defense risk framework. ASIC, DFSA, FCA, HKMA​​​​​​​
Tradle A blockchain-based KYC and onboarding platform that uses AI, IoT and cloud to help financial institutions meet regulatory obligations for SMEs, Corporates, Capital markets, Wealth Management, Retail and Unbanked customers and helps regulators provide guidance and supervision for their markets. They will work with GFIN on self-executing cross-border KYC policies. Abu Dhabi Global Market (ADGM) and FCA​​​​​​​

GFIN members are exploring ways of supporting cross-border tests either through their own regulatory sandbox, or by additional means.