The Bank of Lithuania has announced a new regulatory and technological sandbox platform-service to encourage domestic and foreign companies to develop and test fintech blockchain solutions.

Dubbed LBChain, the platform-service is being developed by the Bank of Lithuania and will enable companies to gain new knowledge, carry out blockchain technology research, and adapt and test services that use this technology within the activities of financial institutions.

“Blockchain technology has tremendous potential for innovations that will benefit consumers in both the financial and public sectors. Giving businesses room for the regulated development of this technology will make our country increasingly attractive for investment and help us attract the best talent, as well as make Lithuania a home for innovations,” states Marius Jurgilas, Member of the Board of the Bank of Lithuania.

Jurgilas believes that blockchain technology could prove to be extremely valuable for areas requiring high data transmission security and credibility is required such as financial operations or electronic voting.

The Bank of Lithuania said that it will provide LBChain participants with a technical platform and offer consultations on applicable regulations. According to the official release, the platform’s facilities will only be available to innovative companies that are to be selected on the basis of certain criteria.

“This platform will contribute to the creation of better conditions in Lithuania for the development of FinTech businesses, as well as provide innovation-friendly regulation. Moreover, it will help the Bank of Lithuania to keep pace with the technological innovations that are changing the activities of financial institutions,” Jurgilas said.

The LBChain could be launched as early as 2019 after the confirmation of the project’s co-financing with EU funds, and the completion of initial preparations.

Estonia, Latvia, and Lithuania, signed a Memorandum of Understanding (MoU) in late 2017 on their cooperation for regional capital market development with blockchain technology as a possible area of cooperation.