Congress eyes greater oversight of the crypto market
The US Securities and Exchange Commission (SEC) is preparing to hold a meeting with representatives of the crypto market — something neither the central banks nor the Financial Stability Board (FSB) have done before — and has invited regulators from around the world to participate. The regulators have until early December to agree on a joint approach to regulating the nascent industry. The meeting is the first step in the “phase 2” of a four-stage initiative — called the SEC’s crypto initiatives — designed to establish new standards for how the SEC regulates the crypto market and to create a unified regulatory framework for crypto firms and other entities. The initiative will be overseen by the SEC’s executive director and head of the division of enforcement, William Hinman. The first meeting with the industry is scheduled to take place on December 4 and 5, with a follow-up meeting set for December 13 in New York.
The initiative comes amid increasing scrutiny over the unregulated nature of the crypto market, coupled with concerns that the SEC might not be adequately protecting investors in the emerging field. The agency has not, as of yet, brought any enforcement actions against ICOs — though this is expected. At the same time, the agency is reviewing guidance issued by its predecessor, the Commodity Futures Trading Commission (CFTC). The agency is also considering whether to consider a new approach in determining whether it must enforce the anti-money laundering rules. The SEC is also reviewing a proposal from the British government that would allow banks and other financial institutions licensed by the British regulator to offer crypto-linked securities.
For its part, the FSB — which is not part of the initiative — will not be meeting with the crypto market or its participants.
The SEC will not meet the FSB as well, since it had previously established an informal dialogue with the British regulator, which will now be incorporated into a formal dialogue with the US agency, the Financial Action Task Force (FATF). The FATF is charged with developing and
