MGA launches Phase 2 of its Sandbox Regulatory Framework

Following a successful first phase of its Sandbox Regulatory Framework, the MGA has now officially launched Phase 2 of the Framework, giving both prospective and existing license holders the ability to potentially integrate Innovative Technology Arrangements (ITAs), as well as Distributed Ledger Technology (DLT) platforms and smart contracts, to their operations.

With the inclusion of ITAs and DLTs in the Sandbox, operators are now able to request specific approval from the MGA following a positive and successful system audit conducted by an MDIA-registered auditor in line with the terms of the Innovative Technology Arrangements and Services Act.  With DLTs now being potentially accessible to the gaming industry, the MGA is permitting games, game components and other essential components, subject to their technical capabilities, to be hosted fully or partially on a DLT environment following a successful system audit as already mentioned.

The majority of the focus for Phase 2 however, lies in the use of smart contracts for the execution of game transactions, these being those where player funds are held in escrow after the player places a bet, and then the funds are transferred back to the player’s wallet or to the operator’s wallet. In any case, the MGA have set out a small number of criteria which must be adhered to if an operator wishes to have a smart contract pay-out system on their platform.

As a result of introduction of Phase 2, the MGA has extended the Sandbox Regulatory Framework until 31st December 2021. The updated guidance document can be found on the Authority’s website, along with a contact email for those with any queries.

Article written by Dr Gabriel Fenech.

For any further information or assistance, please contact Mr Reuben Portanier on

Disclaimer: This article is not intended to impart legal advice and readers are asked to seek verification of statements made before acting on them.