DLT Regulatory Framework

Definition ∞ A DLT regulatory framework comprises the specific laws, regulations, and guidelines established by authorities to govern activities involving Distributed Ledger Technology. This framework addresses aspects such as token issuance, digital asset trading, custody services, and decentralized finance operations. Its purpose is to mitigate risks associated with DLT, including financial crime, market manipulation, and consumer harm, while also fostering innovation. Such frameworks aim to provide legal clarity and operational certainty for participants in the digital asset ecosystem.
Context ∞ Jurisdictions worldwide are actively developing and refining their DLT regulatory frameworks, making this a frequent subject in financial and crypto news. The challenge lies in creating regulations that are adaptable to rapidly evolving technology while maintaining consistency with established financial principles. Key areas of discussion include licensing requirements for DLT service providers, the classification of various digital assets, and international regulatory cooperation to prevent arbitrage.