Technology

Regulation of “crypto” platforms, a priority for IOSCO – Sciences et Avenir

Hugh Jones

LONDON (Reuters) – The high-profile bankruptcy of crypto asset exchange platform FTX makes regulation of the sector even more urgent, and this type of “conglomerate” will become a priority in 2023, FTX’s new chairman told Reuters. coordinating body of financial authorities.

According to Jean-Paul Servais, the regulation of “crypto” platforms can be based on the basic principles in force in other areas at risk of conflict of interest, such as financial rating agencies or index specialists. you have to develop it from scratch.

If there is no own regulation in the field of crypto assets, then the fall of FTX, which left behind almost a million creditors and losses of billions of dollars, should allow progress in this area, Jean-Paul Servais said. .

“The sense of urgency was not the same two or three years ago. There are different opinions about whether this is a real problem at the international level, because some believe that this is not yet a big topic or risk,” he explained.

“Things are changing, and given the interrelationships between different activities, I think it’s important now that we can open up a discussion, and that’s where we’re heading.”

IOSCO, which coordinates regulations for the G20 countries and beyond, has already set guidelines for regulating stablecoins, a special category of cryptoassets, but the focus now is on the platforms on which these assets are exchanged.

In “classic” finance, there is a clear division between brokerage, stock exchange, banking and issuing activities, each of which has its own code of conduct and regulatory framework.

“Does this apply to the cryptocurrency market? In most cases, I would say no,” Jean-Paul Servais said.

The crypto industry has spawned several conglomerates such as FTX, which take on roles ranging from brokerage and custodianship to proprietary trading and the issuance of “tokens” at the risk of conflicts of interest, explained Jean-Paul Servais.

“For investor protection reasons, more clarity needs to be brought to these cryptocurrency markets through targeted oversight of the application of IOSCO principles to crypto assets,” he said.

“We intend to publish a consultation report on these topics in the first half of 2023,” he said.

The new European regulation of crypto asset markets, or MiCA, represents an “interesting starting point” for developing an international system as it focuses on the oversight of operators in these markets, said Jean-Paul Servais, who is also chair of the FSMA. , Belgian Financial Services and Markets Authority.

“We know there is room for new rules to be developed in the oversight of these types of crypto conglomerates. There is a clear need,” he stressed.

(Reporting by Hugh Jones, French version by Marc Angrand, edited by Blandine Hainaut)

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