The U.S. Securities and Exchange Commission (SEC) are the U.S. federal regulatory body charged with the responsibility of overseeing global capital markets and all market participants within the U.S. Its primary objective is to protect investment assets, to promote fair, efficient and consistent capital structure, and to ensure the maintenance of investor confidence. The SEC enforces federal laws regulating securities markets and issues orders to issuers of record when necessary. It also works on issues that affect and coordinate the activities of broker-dealers, such as registration of mark-ins for securities and listing of customer orders for securities. In addition, the SEC enacts rules and guidelines governing interstate securities transactions, reporting and recordkeeping requirements for registered agents, custody and control of customer assets, reporting of investor protection activities, rules concerning bankruptcies and mergers, supervision of broker dealers and representatives, standards for credit risk management and resolution of disputes or complaints involving credit insurance. The SEC also distributes unregistered prospectus and certificates and authorizes or requires brokers to issue such documents. Brokerage firms also conduct preparatory services and post public notices regarding events, new products and changes in law or policy.
The SEC has issued a statement on regulatory guidelines for stablecoins. The rules and guidelines have impacted accredited dealers as well as market participants who facilitate securities exchanges. Many foreign investors were concerned by this development, with many of them losing trust in U.S.
The Securities Exchange Commission created two new positions, namely one each for regulators that would monitor the progress of Cryptocurrency trading, and one for a team of virtual entrepreneurs to work on solutions to potential market opportunities associated with the crypto systems. There is no word on what the group working on a potential venture will be called, other than it will be a small team. Regulators had been concerned that there would be excessive competition from hedge funds and other capital formation groups attempting to manage the new asset class.
With investors scrambling to find best cryptocurrency toinvest in now, the SEC also indicated that they expect significant increases in the number of tokens being traded on major exchanges in the near future. Cryptocurrency token sales are expected to increase by 20% in the next year. While this may not seem like a large number to you, consider that there is currently no governing body in place to stop the sale of Cryptocurrency and that no regulatory agency is even considering it a matter of public concern.
The SEC did issue a report to members of its staff in January detailing their concerns regarding the risks associated with Cryptocurrencies. According to the report, the use of Cryptocurrency could create risks for investors if the regulating body does not take appropriate action. The report highlighted that the SEC is looking into ways in which the agency can better implement guidelines covering the issuance of derivatives linked to currencies, such as bitcoin. Regulators noted that they are currently in the process of developing a standard protocol for the issuance of securities associated with currencies and are looking for ways to better regulate their sale.
Regulators have been looking for ways to foster growth of distributed ledger technology within the financial industry, particularly as it relates to the issuance of securities. Regulators noted that they have discussed this issue with representatives from both exchanges and virtual organizations operating in the country.
The US Commodities Futures Trading Commission has been meeting behind the scenes since August of this year trying to work out a new set or regulations. The commission has been struggling to find the right way to treat digital assets traded on exchanges. Regulators have been considering creating new rules for several months but no major rules have been finalized as of yet. No clear timeline has been given as to when a decision might be made on whether or not trading platforms could be offered across multiple states in the future.