International Securities Regulator IOSCO Proposes Norms for Crypto Regulation, Invites Feedback

The International Organization of Securities Commissions (IOSCO) has released a consultation paper calling for a “coordinated and effective” regulatory regime for cryptocurrency exchanges. The paper advises authorities to consider implementing standards for cryptocurrency exchanges to combat risks such as fraud and hacking. The IOSCO has received unanimous support from its Board stating that it is time to put an end to regulatory uncertainty with crypto activities. Jean-Paul Servais, chairperson of IOSCO, said the paper was the product of an “intense period of regulatory risk analysis, information sharing and capacity building.”

This article originally appeared on www.coindesk.com

The International Organization of Securities Commissions (IOSCO), a global securities regulator, recently proposed a set of norms for regulating crypto assets. The proposed norms seek to enhance investor protection, market integrity, and reduce the risks associated with these assets.

In a consultation paper titled “Regulating Crypto-asset Trading Platforms,” the securities regulator deliberates on several issues surrounding crypto asset trading, including the risks of cyber attacks, market manipulation, and fraud. The paper also proposes a framework that would require crypto trading platforms to implement several measures to safeguard investors’ interests.

The proposed regulations would introduce requirements for trading platforms to employ advanced security systems to protect investors’ assets. They would also be obliged to implement measures to prevent market manipulation, including conducting periodic audits. Trading platforms would also have to provide full disclosures on fees and risks related to the crypto trading activities.

The proposed norms are significant considering that many countries are grappling with how to regulate the fast-evolving cryptocurrency market. The lack of regulations in the market has led to numerous instances of scams, hacking, and fraud that have resulted in the loss of billions of dollars.

IOSCO’s proposed norms are a step in the right direction, as they seek to bring much-needed clarity and standardization to the market. However, the regulator is taking a cautious approach and is seeking the input of stakeholders before finalizing the norms.

IOSCO invites feedback from various stakeholders, including investors, industry participants, and regulators, to help shape the final regulations. The consultation period will be open until 29 July 2019.

The norms proposed by IOSCO have significant implications for cryptocurrency market participants. Trading platforms and other industry players will have to revise their operations and adopt new practices to comply with the new regulations. Investors will also have a greater degree of confidence when investing in crypto assets, knowing that they are doing so in a regulated environment.

In conclusion, IOSCO’s proposed norms for crypto regulation represent a significant step towards bringing standardization and clarity to the cryptocurrency market. While the consultation period is still ongoing, it is important to note that the regulator is taking a cautious but purposeful approach in developing regulations that protect investors and safeguard market integrity. Only time will tell how the proposed regulations will fare, but one thing is for sure; they will have far-reaching implications for the future of cryptocurrencies.

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