The SEC releases compliance notice detailing the crypto regulatory framework in an 8-page document in which the agency will continue examining digital asset investments so let’s read more in our latest crypto news.
Today, the US Securities and Exchange Commission released a new document which shows details of the framework in which the agency will examine digital asset investments and we can see that it made it clear to broker-dealers and investment advisers that cryptocurrencies and other types of digital assets face similar levels of scrutiny as traditional securities and will demand regulatory compliance from custody, registration to bookkeeping as well.
As the SEC releases compliance notice, it stated that it observed inadequate AML procedures, controls, and documentation due to the decentralized nature of the digital assets and for advisories registered with the Financial Industry Regulatory Authority, it will require stricter KYL procedures in compliance with FINRA’s rule 2090. Many of the key examinations rehash the traditional financial practices and reapply them to digital investment but new concerns have emerged due to the fundamental differences between asset classes.
The questions on how much control an investment company will have over the private keys of the clients are one of the many issues that were brought up in the compliance notice. The timing of the report doesn’t coincide with the events but with the prevalence of the social media platform and the skyrocketing of the coins like DOGE, many new discussions emerged within the SEC on the many dangers of unregulated industries.
Officials outlined the notice as a reminder of the risks that will be associated with the digital assets and the necessity of compliance with frameworks to protect the shared interests of the market participants.
As recently reported, Crypto industry leaders agreed that it needs more clarity to encourage the higher uptake of digital assets but regulatory colleagues are not an easy bunch. The crypto-friendly SEC Commissioner referred to as “Crypto Mom” said that BNY Mellon’s crypto plans are even more pressing for the US regulators to take action and to create more regulatory clarity. The crypto industry leaders agree that more clarity is needed or more uptake of digital assets. Hester Peirce called for a regulatory safe harbor in the past which will provide them with a few years to get all things done before the SEC comes after them for fraud.
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Stefan has been writing articles for DCForecasts since 2016 in-house full time. As one of our main cryptocurrency writers, he focuses on covering the latest cryptocurrency news, technical charts, price analyses of coins and press releases. When he is not exploring and covering the latest topics in crypto, you can find Stefan playing basketball, tennis or cycling.
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