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US SEC releases framework for future crypto regulations.

The U.S. Securities and Exchange Commission (SEC) released an 8-page document that details the financial agency


As the traditional financial world begins its mainstream adoption of crypto assets, the process of legitimizing cryptocurrencies as financial products pose a myriad of risks and regulatory challenges. The U.S. Securities and Exchange Commission (SEC) released an 8-page document that details the agency’s framework to examine digital asset investments. Regulators around the world have shown concern over crypto regulations in recent times as the industry continues to gain mainstream exposure. 

 

SEC stated it observed inadequate AML regulations with crypto. 

Demanding regulatory compliance across areas ranging from custody, bookkeeping, registration requirements to conflicts of interest protocols, the SEC has made it clear to major broker-dealers and investment advisers that digital assets will face similar levels of scrutiny as traditional securities. For instance, the SEC stated that it “observed inadequate Anti Money Laundering (AML) procedures, controls, and documentation” due to the decentralized nature of many digital currencies. For advisories registered with the Financial Industry Regulatory Authority, they will require stringent Know Your Customer procedures in compliance with FINRA Rule 2090. 

 

Lawmakers across countries express concern over the crypto industry. 

Regulators across countries have recently expressed their concern over the growing crypto industry and the massive winning rally of the leading cryptocurrency bitcoin. As reported earlier, the Reserve Bank of India expressed concerns on cryptocurrencies related to money laundering issues to funding terrorists. Speaking at a financial sector innovation policy roundtable, the former Federal Reserve Chair and the current U.S. Treasury Secretary Janet Yellen warned that cyberattacks and digital currency-related crimes were on the rise. Several other regulators around the world have expressed their concern over cryptocurrencies.  



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