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RESEARCH PRODUCT

THE SANDBOX OF THE UK FINANCIAL CONDUCT AUTHORITY AS A WIN-WIN REGULATORY DEVICE?

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This paper deals with initial coin offerings (ICOs) and the sandbox approach that has been adopted by the UK Financial Conduct Authority (FCA). Its conclusion is that this approach is no longer an instrument for mutual learning only, but that it is becoming a device that produces an original form of cooperative regulatory design where the FCA cooperates with firms to shape the algorithms in a way which is more investor-friendly. Moreover, since this activity does not necessarily imply a tradeoff between social benefits and private costs, unlike other forms of cooperative regulation; and since this activity does not regulate the algorithms directly, as happens with other forms of regulatory design; the sandbox could pave the way for a form of win-win regulation that would transcend the debate on technology neutrality