The Securities and Exchange Commission’s (SEC) compliance office and the European Securities and Market Authority, in alliance with several other regulators, have made cryptocurrency among their prime concern this year.
The SEC’s Office of Compliance Inspections and Examinations (OCIE) highlighted its 2020 Examination Priorities and one of them is advancements in financial technologies (fintech), as well as digital assets and electronic investment advice.
The examinations will touch on six key areas: investment suitability; portfolio management and trading practices; safety of client funds and assets; pricing and valuation; effectiveness of compliance programs and controls; and supervision of employees outside of business activities. The OCIE will also pay attention to the Financial Industry Regulatory Authority (FINRA) through its operations, regulatory programs, and the quality of FINRA’s examinations of broker-dealers and municipal advisors.
Over in Europe, the European Securities and Markets Authority (ESMA) has released Strategic Orientation 2020-22, focusing on its priorities for the year. As stated in the document, ESMA requires the EU market participants to ensure business continuity and the use of adequate and up-to-date technology, as well as adequate protection against cyberthreats, and through proper data protection and data quality management, in order to stay cautious with the risks that may stem from digitalization.
Highlighting that fintech can contribute to well-functioning financial markets and investor protection, ESMA will therefore actively examine new opportunities the technology might bring particularly for investor protection and share expertise and know-how with national authorities. The regulator will work together with national regulators to accomplish its goals.
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A keen researcher who believes in enriching her knowledge. For Shuhada, the crypto world intrigues her sense and offers plenty of high delicious 'crypto cuisines'.