In an exclusive interview with Cointelegraph, Albert Isola, Gibraltar's minister for digital and financial services, argued that every country that respects contract laws recognizes crypto payments in the absence of regulation that prohibits them.

On the question of whether Gibraltar legally recognizes crypto-nugget payments, Minister Isola stated: "Yes. [T]he transfer of crypto assets and crypto payments [are] already happening."

"On the question of whether they are recognized, I don't believe at that place is a law on this planet, other than those that have specifically excluded it, that volition not recognize the validity of the transfer of digital avails because the law of contract enables yous to transfer anything — whether it's a boat, a house, a car, a cardinal or a crypto nugget."

'Don't regulate the asset'

"The question is, in legal terms, how do you identify what it is that you are transferring?" Minister Isola continued. "As long equally you lot get identified, you lot can transfer information technology and on a proper legal footing."

The digital services minister emphasized that Gibraltar'due south regulatory framework provides "a legal framework to that transfer" — regulating the businesses and individuals that transfer in crypto avails, rather than the underlying avails themselves.

"In other words, we are proverb if you lot are going to transfer crypto assets from one identify to another and that's your business, you're going to exist regulated. We're not only going to recognize the validity of that contract, but we're going to regulate the very people that are doing it," he added.

The judgment that they came to very early on was: don't regulate the asset, regulate the people that are moving it, regulate the people that are advising y'all on how to move it.

Fiscal services informs Gibraltar'due south DLT regulations

Minister Isola stated that Gibraltar's lawmakers sought to employ the regulatory principles underpinning the fiscal services industry to the blockchain sector.

"In the same way as in fiscal services, if somebody advises yous where to invest, that guy should be regulated. It's not the investment that is regulated, it's the person that'south advising you — we are doing exactly the same and offer a look in the crypto space."

"Information technology's a very mutual-sense approach," he added.

Blockchain island

After four years of development, Gibraltar introduced a permissive regulatory regime for blockchain firms at the showtime of 2022.

The overseas British territory has since attracted many of the industry'southward leading firms, including major crypto exchange Huobi and pioneering crypto custody and payments platform Xapo.