In a manner characteristic of European acceptance of adaptive technologies, Luxembourg’s latest move to seek the passage of a law to legalize the use of blockchain technologies with a third layer of security is unsurprising indeed!
Building Technology leadership
Europe has traditionally been the gate-keeper when it comes to adopting nascent tech, be it sustainable technologies, green environment laws, privacy laws or data protection. Hence, when Luxembourg Finance Minister – Pierre Gramegna announced that his country is pioneering the integration of blockchain technology through local acts in the “best interests of the financial sector,” the world is sure to take note.
Gramegna’s comments come on the back of the land-locked nation’s years of toil ensuring that it has a productive environment for start-up companies, big technology companies, and game-changing industrial players through appeasing tax rates, land taxes, and similar relief.
Surrounded by Belgium, Germany, and France with their pro-technology commercial laws, Luxembourg has had to be the proverbial first-past-the-post competitor to attract investors and technology companies to operate in the country.
In the second decade of the millennium, these Western European nations have been competing for a bite of the big and ballooning blockchain technology market and have been offering various business advantages to global kickstarter companies to set up shop in their respective nations. However, the issue with blockchain technology is not only about Bitcoin or other altcoins.
Decentralized Ledger Technology (DLT)
Discussions of the legal status of blockchain technology are never far from cryptocurrency. Only a few outsides of the crypto world understand that the technology is not just about non-fiat currency, but about the new technology that ensures every transaction is always transparent, and all transaction stakeholders are clearly stated. This transparency is brought about, by the manner in which the ledger or the bookmarks which track a transaction are maintained. The ledgers are not supported by a single centralized third-party entity such as a bank but individual stakeholders creating the basis for the decentralized ledger technology (DLT).
Fast adoption of DLT
In just a few years since this decentralized concept’s gestation, experts have exploited the transparency factors and used it for multiple business processes from supply chains in logistical services to highly complex and confidential processes of pharmaceutical products, and even adult franchises in the Baltic nations. The real value of blockchain technology has begun to bear fruit in these diversified sectors because of the high-value that “transparency” of the system has brought to the players involved.
Thus, it becomes vital for a nation such as Luxembourg with its pro-DLT practices to recognize it as legal. As Prime Minister Xavier Bettel states, the new legislation supporting blockchain technology will fulfill the political role of the nation as a “kickstarter and coordinator” allowing the industry to arrive with technology and commercial choices. At the same time, the passage of new bills by the government would give the necessary fillip to create “meaningful projects using cutting-edge technology.”
Luxembourg’s move could well be the start of blockchain technology gaining legal acceptance in one of the most protective regional territories of the world!