The securities regulatory agencies are making efforts for standardizing the crypto-related policy. The worldwide securities regulatory organization has issued the inaugural agenda for crypto assets. Nonetheless, the decentralized finance (DeFi) sector will not be leveraging it this time. As included in the respective agenda, a proposal comprising 18 points has been proposed by the International Organization of Securities Commissions (IOSCO) recently.
IOSCO Proposes Recommendations for Crypto Policy in Its Latest Report
The agency has proposed recommendations related to crypto policy in its exclusive consultation report. The recommendations deal with 6 chief areas. These areas take into account retail access, technological and operations risk, asset protection, custody, market manipulation, as well as interest clashes.
One of the recommendations advises the regulatory agencies to order the crypto asset service providers (CASPs) to isolate the assets of the consumers from the proprietary assets. This takes into account the placement of the user assets in isolated bankruptcy-remote accounts or trusts. This move is focused on guaranteeing that the respective assets are distinctive and separate from the estate or assets in possession of the CASPs.
This is considered to be a noteworthy inclusion while keeping in view the embezzlement of client funds at the now-bankrupt crypto exchange platform FTX. This series of recommendations provides great attention to the market activity within the centralized market. Nevertheless, no response is given by the respective recommendations to the things related to the DeFi sector.
Another task force formed by the same regulatory agency is responsible for examining the considerations concerning the DeFi world. When it comes to the feelings of IOSCO about the mapping of digital assets to the present securities laws, the agency’s recent report also makes some suggestions. It says that the regulatory organizations operating around the globe should utilize the existing or modified agendas.
The purpose of those agendas would be to track the present standards set by IOSCO for the regulation of the securities. That takes into account the marketing and issuance of cryptocurrencies. The regulatory agenda should intend to attain regulatory objectives for the protection of the investors as well as to maintain market integrity.
The Recommendations Attempt to Grow Coordination Between the Regulators Worldwide
These things are consistent with the requirements of the conventional financial markets. The respective recommendations highlight the significance of cooperation among regulators around the world. The target of the IOSCO is to establish a benchmark for participants to promote coordination and collaboration.
It also aims at creating efficient responses to the challenges experienced by the entities in the case of supervision and enforcement for cross-border operations. In addition to this, IOSCO is endeavoring to promote optimal consistency for the regulations set for the markets dealing with securities and crypto assets under the IOSCO jurisdictions.
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