Regulatory sandboxes allow digital start-ups to temporarily test new products without fully complying with regulations. This article defines regulatory sandboxes and examines their potential as innovation incubators that provide more flexibility than traditional regulatory frameworks. It provides brief historical context, followed by case studies of successful regulatory sandbox implementations in various countries. The benefits for digital entrepreneurs are discussed, including expedited product testing, easier access to investment, and the freedom to experiment. Challenges are also addressed, such as maintaining adequate consumer protections and a level playing field. The article concludes with suggested best practices for implementing regulatory sandboxes that serve the interests of both start-ups and the general public. Ultimately, appropriately governed sandboxes could significantly boost innovation.