Developments in the blockchain space are happening at a rapid pace and we can witness institutions and companies exploring blockchain use-cases, recognizing their absolute grounds in the blockchain (networks), architecting protocols and reaching out to parties (potential partners) to convince them of co-founding or joining the proposed network. However, there are some shortfalls in their approach that has been a major reason behind the slower-adoption rate of blockchain technologies. An enterprise level value-creating DLT network can only happen if companies and government can work together to revisit their current approach. In this document, we will try to outline a policy approach that might help eliminate key obstacles for network formation.

1. B L O C K C H A I N :
P O L I C Y
G O V E R N A N C E
N O V . 2 0 1 9
B L A C K C H A I N .
G U R U

2. B L A C K C H A I N .
G U R U
Overview
Developments in the blockchain space are happening at a rapid pace and we
can witness institutions and companies exploring blockchain use-cases,
recognizing their absolute grounds in the blockchain (networks), architecting
protocols and reaching out to parties (potential partners) to convince them of
co-founding or joining the proposed network.
However, there are some shortfalls in their approach that has been a major
reason behind the slower-adoption rate of blockchain technologies. An
enterprise level value-creating DLT network can only happen if companies and
government can work together to revisit their current approach. In this
document, we will try to outline a policy approach that might help eliminate key
obstacles for network formation.

3. B L A C K C H A I N .
G U R U
Policy Governance
Key focus areas
Without a clear objective, a policy can’t be
outlined. Eligibility and applicable areas of
activity, of the policy, must be clearly addressed
in the objectives. The objectives must also
mention an authority that takes care of the
entire policy and also must be responsible for
tuning the balance in the policy. Benefits and
purpose of the policy must be clearly outlined in
the objectives.
Objectives
Network formation and
operation
There are two rules that govern the network
formation, Permissive or Restrictive.
In the case of Permissive rules, it enables the
participants to create a network spontaneously
with only an announcement of conformity. This
approach may result in experimental formations
of networks, in great numbers.
On the other hand, restrictive approach may
require approval in order to form the network, and
result in networks being formed only after thorough
diligence and research. General rules can be outlines
in the formation rules and the topic of accession and
succession from the network may also be covered.
Technology and standards
A policy might be flexible in nature regarding the
mode of developments that might take place in
future, it may be prudent to select a few approaches
that are preferred over others to narrow choices for
some types of use cases. At the same time, leaving
an option to introduce new standards and
technologies may be a path left open for
exploration and learning.
Without a clear objective, a
policy can’t be outlined.
Eligibility and applicable areas
of activity, of the policy, must
be clearly addressed in the
objectives.

4. B L A C K C H A I N .
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Distributed Ledger Technology network is
defined by identities represented by private and
public key, the concept is the same as, Internet
is a network of locations defined by Internet
Protocol (IP) addresses. In the case of DLT, the
identity of an address defines it, with location
being a secondary layer, while on the internet,
the location of an address defines it with identity
being a secondary layer.
Irrespective of the technology approach, its sure
that DLTs are networks recognized by identity, so
in this case the policy must outline the process
of definition of member’s identity. To sign all
transactions, Distributed Ledger Technology
depends upon strong cryptography and for
permissioned blockchains, the members
participation in the consensus is also
determined by strong cryptography. For this
reason, one of the most important elements of a
policy is the definition of identity and the
regulation of access control lists as well as
prudent specification of the requirements for
the
Identity and security
technology that must support the definition of
compliant identities. To maintain an appropriate
level of security, use of self-sovereign identity (SSID)
architecture and hardware devices may be required.
Continuous improvement
Technological sectors are the fastest moving sectors
if compare to other fields, and hence, the policy
should be flexible enough to adopt periodical
changes and the shifts must be reviewed thoroughly
before amending. To stay in the with this fast-
moving DLT landscape, the frequency of review
must be as short as a year or shorter. Three points
should be respected while assessing changes, such
as Loopholes in the current policy, Introduction of
new technology, Older solutions losing support The
policy may also need to shift focus as use cases are
proven or disproven and DLTs start working across
markets and geographies rather than just within
them.
Policy Governance
Key focus areas

5. B L A C K C H A I N .
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Nationally led approaches
Examples of nationally led approaches to enabling
blockchain and DLT through policy
Emirates Blockchain Strategy 2021 is a
blockchain-themed initiative taken by the UAE.
With this strategy, UAE is aiming to transition a
total of 50% of applicable government
transactions to a blockchain by 2021. In respect
to this initiative, a blockchain platform has been
launched by Smart Dubai to research
government use cases, and approximately over
30 blockchain projects are said to be under
development. With the help of this policy,
establishment of integration channels are being
done by government entities to improve
functioning of services that cut across areas of
responsibility of several entities, and increasingly
to enable digital integration with the private
sector.
Issuance of a sandbox has been initiated by
ADGM FSRA - Abu Dhabi Global Markets
Financial Services Regulatory Authority and
ADGM FSRA has also issued guidance to
regulate crypto assets with purpose to create
rules that will govern the operations of
cryptocurrency
related fintech businesses. On the other hand,
CBUAE - Central Bank of the UAE has circled
warnings about cryptocurrencies are banned from
being used in a commercial transaction context and
are not considered as a valid/ recognized currency
under current regulations/ legislation.
In addition, the Emirates Authority for
Standardization and Metrology (ESMA) are one of
the twelve observing members Monitoring ISO/TC
307 (ISO Blockchain Standards).
United Arab Emirates
Malta
Malta encourages blockchain based innovations and
has recently regulated blockchain and DLTs through
technology certification. Malta Digital Innovation
Authority may certify
blockchains and DLT platforms with the help of a
system auditor that examines the arrangement of
the technology and provides assurance on the
solution’s quality and characteristics, according to
the MDIA Act. This review system has been
developed to maintain the community’s trust in the
technology, by regulating this sector through
certification.

6. B L A C K C H A I N .
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There have been several different policies in the
U.S regards to blockchain. State governments
have received rights from the federal
government that they can create and
implement their own policies and regulations.
To encourage innovation in the blockchain
space, some states in the U.S have removed the
legal barriers for the adoption of blockchain by
developing blockchain-friendly legislation. By
publishing Blockchain Technology Act, State
of Illinois specified the permitted use of
Blockchain for conducting business and
disregarding any restriction Blockchain or smart
contracts by local governments. Motivated by
innovative features of blockchain, another state
that set an example of encouraging innovation is
Wyoming, by creating a permissive policy. The
state has passed a collection of 13 blockchain
and cryptocurrency friendly laws. Among them
is the establishment of a new type of bank that
can hold crypto assets for its customers starting
in 2020.
On the other hand, the state of New York
created the BitLicense,
seen as a restrictive approach. BitLicense is issued by
the NYSDFS - New YorkState Department of
Financial Services. Under this regime, any business
operating in the virtual asset space must first obtain
approval for a license to carry out activities.
United States
Liechtenstein
Another country that has shown interests in
regulating the token economy is Liechtenstein. The
country’s blockchain act focuses on the creation,
storage, and transfer of tokens, while maintaining
the security for enforcement of the rights associated
with every token, hence creating a digital
economy.
Nationally led approaches
Examples of nationally led approaches to enabling
blockchain and DLT through policy

7. B L A C K C H A I N .
G U R U
The European Union has taken measures to
welcome blockchain-related policies or
legislation, adopting a permissive stance with
wide discretion given to the member countries.
In 2015, the EU allowed exchanges of traditional
currency for cryptocurrency to not charge Value
Added Tax on their service, giving way to
cryptocurrencies to function as forms of money.
On the other hand, the EU also mandated KYC
and AML measures that have to be
implemented by cryptocurrency exchanges
under the Fifth Money Laundering Directive
(5MLD).
In addition, to maximise the potential of
Blockchain and DLT in the EU, the European
Parliament is requesting the European
Commission and other EU authorities to take
various steps. It has prescribed that any
regulatory approach related to Blockchain and
DLT should be innovation-friendly, should enable
passporting, and should be governed in
accordance with the principles of technology
neutrality and business-model neutrality. the
body clearly mentioned that the Union should
not regulate DLT per se,
but should focus on removing existing barriers that
may come in implementing Blockchains, calling on
the Commission and the Member States to foster
the convergence and harmonization of regulatory
approaches. The commission is following a use-case
method in exploring regulatory environment around
the use of DLT and the actors using it by sector.
The European Data Protection Supervisor (EDPS), the
EU’s independent data protection authority, has
been given the responsibility of: providing further
guidance on how DLT can comply with the EU
legislation on data protection, and in particular, the
General Data Protection Regulation; working with
international organisations to enhance the
development of technical standards for smart
contracts and to undertake an in-depth analysis of
the existing legal framework in all member states on
the enforceability of smart contracts; assessing
whether any potential barriers to use of smart
contracts are proportionate, noting that legal
certainty could be enhanced through coordination
and mutual recognition between member states;
and analyse whether a European passport for DLT-
based projects could be introduced to enhance legal
certainty for investors, users and individuals and
promote financing to small- and medium-sized
enterprises.
European Union
Nationally led approaches
Examples of nationally led approaches to enabling
blockchain and DLT through policy

8. Known as the youngest and most influential Blockchain expert in the field. She is
an Italian-American who first started out as a startupper in the AI and IT business,
while still finishing her Economics and Management studies in Bocconi. Eloisa is
a renowned author, public speaker, and biz-dev, catering startups and
companies wanting to innovate. Currently being the Chapter
Director of Bocconi University Startup Grind Chapter, she made valuable
connections and became a part of some of the main blockchain associations
around the world, namely The Blockchain Council and The NYC Women in
Blockchain. She will be featured in the Forbes Italy 30 Under 30 most influential
entrepreneurs in 2020.
Giovanni Casagrande
A known name in the world of cryptocurrency. He has been in the marketing
industry for well over 20 years and have switched to the cryptocurrency industry
in 2014. He’s a writer, public speaker, investor and Marketing / Growth Hacking
advisor in more than 100 successfully projects. His specialty was Economics in
the University of Bologna and the knowledge, experience gathered from there
has helped him to manage/help many businesses in the industry. 4 years ago he
founded Black Marketing Guru, a successfully Growth Hacking startup in Italy.
Giacomo Arcaro
He has 15 years’ experience in growth hacking, digital strategy, startup and
business development. He has advised over 150 startups and has 50 managed
employees into a XII Century Church in Italy for the European biggest growth
hacking company. He holds the title of ‘Amazon Best Seller Author’ and is been
known to be one of the ‘Most Influencial Blockchain Evangelist’ with +200
conferences all over the world.
Eloisa Marchesoni
'The Most Influential Fintech Advisor' 'European Best Growth Hacker'
'Number 1 ICO Advisor Worldwide
Award'
'An influential Personality in the
Blockchain Space'
'Number 1 token model architect for
ICOs'
'Top 100 Fintech Leaders and Influencers
in Italy'