Isle of Man Approves Regulatory Changes to Enable Bitcoin Gambling

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Bitcoins.jpgThe Treasury and the Gambling Supervision Commission (GSC) of the Isle of Man have approved proposals to modify gambling regulations to permit the acceptance of cryptocurrencies such as Bitcoin gambling sites.

Some other changes to this regulation, which is called the Gambling Regulation Package 2016, enable operators to offer their players more voluntary gambling controls. In all, there are six such changes, but government drafters need to approve these changes before they can be actually implemented.

Gambling Regulation Package 2016

On April 20, the GSC released details of the proposed changes that had been approved and gave stakeholders time till May 20 to present their comments. The GSC is in favour of permitting licensees to accept deposits in cryptocurrencies.

In 2014, the GSC was weighing the pros and cons of allowing licensees to accept bitcoins, but the Department of Economic Development (DED) had declared that cryptocurrencies are property, not currency. The regulations of those days allowed registration of accounts only by using “a deposit of money” by credit or debit cards or other methods “approved by the commissioners.”

The GSC now wants these words to be changed to “a deposit of money or the deposit of something which has a value in money or money’s worth.” According to the document, “the format of the money’s worth will still require the commission’s specific approval.”

The GSC has also clarified that bitcoins can be accepted only if regulatory safeguards related to storage security and value protection are implemented. Operators running bitcoin exchanges will also have to report to “a credible financial intelligence unit” in compliance with procedures established to prevent money laundering.

Approving Test Certificates

The GSC has also approved proposals to recognize test certificates from approved jurisdictions as equal to those issued in the Isle of Man.

Operators approach testing laboratories that make sure that the games offered are fair and random and receive certificates from the same. Each gambling jurisdiction sets its own standards, based on which operators can obtain testing certificates. Tough gambling regulations prevent the acceptance of test certificates issued in one jurisdiction in another jurisdiction.

But the new laws are going to change all that as they suggest that a legislative drafter can make a list of accepted standards and effectively administer certification of gaming and lottery systems.

Licensees Have Not Demanded Changes

In a statement made to CoinDesk, GSC Deputy Chief Executive Mark Rutherford said that these moves seek to fix “a small hook in our gambling law.” At the same time, he pointed out that licensees have not demanded any changes in laws. According to him, no licensee wants approval to accept bitcoin deposits.

He said that the Isle of Man has decided to fix the gaps in its regulatory framework to include bitcoin acceptance as it has no intention of impeding future economic developments or innovation in technology.

He said: “We’re ironing that out so that if the commercial climate in the future becomes less challenging for block-chain based payment channels, it won’t be our law that prevents their adoption.”

May 6, 2016: • No Comments

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