European And US-Based Regulators Prioritize 2020 For Crypto

Several regulating bodies both within Europe and the US have started to make cryptocurrencies some of their top priorities of the year 2020. The European Securities and Markets Authority (ESMA) and the US Securities and Exchange Commission (SEC), has outlined its plans of focusing on crypto oversight, alongside many other regulators. China has already been busy with it: its central bank has made crypto a priority in the past.

SEC Planning To Fully Regulate

The Office of Compliance Inspections and Examinations (OCIE) of the SEC has announced its priorities for 2020 on Tuesday. OCIE handles the national exams of the SEC, a bid to try and ensure market integrity, investor protection, and capital formation support. The SEC then uses the results of these exams as information for identifying and monitoring risks, improving industry practices, helping with rule-making initiatives, and to pursue misconduct.

The OCIE made a statement regarding the advancement of various financial technologies, cryptocurrencies included. The Office explained that it warranted “ongoing attention and review.” They further noted that the crypto market has “grown rapidly and presents various risks.” Of these risks, lack of understanding between the differences of cryptocurrencies and more traditional investment products stands at the forefront.

These examinations will investigate six critical aspects of cryptocurrencies. Things like Portfolio management, investment suitability, client fund, and asset safety, trading practices, compliance program effectiveness, valuation and pricing, and finally, employee supervision will all be reviewed.

ESMA Urges Differentiation Between Conventional And Crypto

On Europe’s shores, ESMA has released a Strategic Orientation for the years 2020 to 2022 on Thursday. Within it, it highlighted the priorities of those years.

As the document explained, ESMA will require its EU market participants to “acknowledge the risks that may stem from digitalization.” They must do this by way of “ensuring business continuity and the use of adequate and up-to-date technology.” Furthermore, it mandates market participants to provide “adequate protection” when it comes to cyber threats, data quality management, as well as data protection.

PBOC Further Crypto Development

On the Asian front, the People’s Bank of China (PBOC) announced its own form of this prioritization on the 5th of January, after an annual conference held in Beijing last week.

Within this announcement, China’s central bank plans on strengthening its research and development, as well as the application of fintech. Furthermore, the bank announced that it was still going to “steadily advance research and development” of its state-owned crypto that it debuted last year.