The Securities and Exchange Commission (SEC) has approved the application of Blockshoals Technologies, Inc. to test its financial products and services in the Commission’s regulatory sandbox, as it continues to support innovations in the financial sector.
In its meeting on November 12, the Commission En Banc resolved to grant an in-principle approval for entry into the SEC regulatory sandbox to Blockshoals, subject to the company’s compliance with certain remaining requirements.
Implemented through SEC Memorandum Circular No. 9, Series of 2024, the SEC StratBox is a regulatory sandbox that allows firms to test innovative products or services in a live but controlled setting, with the goal of eventually offering them to the public at large.
The SEC may also grant regulatory reliefs to sandbox participants by modifying or replacing specific licensing, registration, compliance, or other regulatory requirements that may otherwise apply, during the sandbox period, according to the framework.
Blockshoals is a domestic fintech company that serves as a technology and infrastructure intermediary for virtual asset services, which entered into a partnership with a global crypto exchange to operationalize its proposed Stratbox application.
The Stratbox testing period is set to run for 24 months, with a possibility that it may be shortened or extended after the first year, subject to periodic review.
The approval of Blockshoals’ application brings the total number of entities testing their products or services in the SEC Stratbox to four. Of these, two are related to the offering of US equities, and one concerns the offering of tokenized real estate.
The SEC continues to review other applications, and remains open to receiving more proposals for its regulatory sandbox, as part of the Commission’s commitment to advancing innovations in the capital market.
