Although technological innovation comes without borders, the related industry regulations do not and require financial services firms to work closer with the various national regulators, according to Nicole Sandler, innovation global policy lead at Barclays.

An indelible technology like distributed ledgers poses a potential issue with Article 17 of the EU’s General Data Protection Regulation regarding the right to be forgotten.

If clients request to have their private data removed from a blockchain, firms will find that they cannot remove the data.

“Well, that is going to be a problem,” said Sandler during a presentation at the FinTech Forward conference. “You have fines up to 4% of your annual global turnover.”

There is no escape for non-EU firms due to the extraterritorial nature of the regulation, she added.

Another regulatory issue in respect to new innovative technologies and products is the lack of harmonized definitions amongst national market regulators.

The US, UK, India, Singapore, Japan, and Switzerland would treat a new stable coin differently as long as they already had defined what a stable coin is, noted Sandler. “If something is not defined, how on Earth can you regulate it if you need to understand what it is before you can regulate?”

The best way to approach these issues is to work with the various regulators and help them understand the technology and the issues at hand.

Sandler herself has a seat on the European Commission’s Regulatory Obstacles to Financial Innovation Group.

“The purpose of the group is to turn around to the Commission with a report saying that there may be things they can improve on their current framework,” she said. “I’ll give a lot of kudos to the Europeans and the Commission because they want to be market leaders and they know that their framework may not actually work for us”

The group expects to release a report in November that sets out its recommendations to the new Commission across several topics.

Sandler also recommended that firms take advantage of regulatory sandboxes whenever firms can.

The UK’s Financial Conduct Authority was the first to launch a regulatory sandbox in 2015 and again in 2016. Barclays participated in both sandboxes that focused on market regulations and sustainability. Since then, Australia, Thailand, Hong Kong, and Abu Dhabi launched their respective regulatory sandboxes.

“Having a regulator sitting with you and saying this is how it works is very very valuable,” she said. “But what I think is that the sandboxes are more valuable to the regulators. In order to regulate something, you need to understand what it is. It’s not about regulating technology, but regulating its use case.”