By George Ward
The International Organization of Securities Commissions (IOSCO) has unveiled its latest policy recommendations for the rapidly expanding crypto and digital asset markets. According to the organization, these groundbreaking guidelines are now open for public feedback and comments.
The IOSCO Recommendation
Unveiling a comprehensive set of 18 policy recommendations, the International Organization of Securities Commissions (IOSCO) addresses critical areas within the digital asset market. These guidelines tackle pressing concerns like market abuse, client assets, conflict of interest protection, and crypto risk disclosure.
IOSCO introduced a series of recommendations in response to widespread concerns surrounding investor protection and market integrity within the crypto markets. In a significant move, the international policy forum that unites securities regulators from approximately 130 countries formed the Fintech Task Force (FTF) last year.
The primary objective of the FTF, chaired by the esteemed Monetary Authority of Singapore (MAS), is to shape IOSCO’s regulatory agenda concerning fintech and cryptocurrency. The task force consists of 27 out of 33 board member jurisdictions, bringing together expertise and diverse perspectives to navigate the evolving financial technology landscape.
Within the FTF is an integral unit comprising two working groups. Nevertheless, notable progress is being made in addressing critical areas of interest.
Spearheaded by the UK’s Financial Conduct Authority (FCA), one working group is focused on publishing groundbreaking recommendations for crypto assets this year. In the same vein, the US Securities and Exchange Commission (SEC) leads another working group dedicated to exploring the realm of decentralized finance (DeFi).
These initiatives demonstrate a concerted effort to navigate the evolving landscape of digital assets and emerging financial technologies.
Recommendations For Global Collaboration
In the wake of the tumultuous events surrounding the collapse of stablecoin issuer Terra and crypto exchange FTX, regulators worldwide have intensified their efforts to advocate for stricter regulations within the crypto industry. Recognizing the need for enhanced oversight and safeguards, they call for more robust regulatory measures aimed at restoring trust and stability in the fast-evolving world of cryptocurrencies.
Meanwhile, more developments are on the horizon as the Financial Stability Board (FSB) prepares to release its highly anticipated recommendations for stablecoins in the coming months. These guidelines will play a crucial role in shaping global crypto regulations.
Moreover, a joint synthesis paper by the FSB and the International Monetary Fund (IMF) will serve as the foundation for future worldwide rules governing the crypto space. In a recent development, the Financial Action Task Force (FATF), an international authority combating financial crimes, urged the advanced economies of the Group of Seven (G-7) to adopt its recommended anti-money laundering rules.
By championing the implementation of these crucial measures, the G-7 countries can play a pivotal role in strengthening global efforts against money laundering. IOSCO advises regulators who have not yet implemented activity-based segregation to consider imposing restrictions on crypto service providers.
The proposal suggests prohibiting these entities from combining specific functions within a single legal entity.
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