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IOSCO releases list of key considerations for regulating crypto-asset trading platforms

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Catherine Martin reporter

Thu, 13 Feb 2020, 07:34 am UTC

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The International Organization of Securities Commissions (IOSCO) has released a list of key considerations to help regulatory authorities when regulating crypto-asset trading platforms (CTPs).

In the report titled “Issues, Risks and Regulatory Considerations Relating to Crypto-Asset Trading Platforms,” IOSCO identified the different issues and risks associated with CTPs.

To help the regulatory authorities in evaluating the CTPs within their regulatory frameworks, it identified key considerations relating to access to CTPs, safekeeping of participant assets, identification and management of conflicts of interest, transparency of operations, market integrity, price discovery mechanisms, and technology, including resiliency and cybersecurity.

“Many of the issues related to the regulation of CTPs are common to traditional securities trading venues but may be heightened by the business models used by CTPs,” IOSCO said. “Accordingly, the report states that the IOSCO Principles and Methodology provide useful guidance for regulatory authorities considering the identified issues and risks.”

It added that it will closely monitor the evolution of crypto markets in order to ensure that "the issues, risks and key considerations identified in this report remain relevant and appropriate.”

In November 2019, IOSCO said that stablecoins, digital currencies with their value pegged to fiat currencies such as the U.S. dollar or euro, should fall under the existing securities regulations.

“Our analysis has shown that so-called ‘stablecoins’ can include features that are typical of regulated securities. This means IOSCO Principles and Standars may apply to stablecoins depending on how they are structured including those relate to disclosure, registration, reporting and liability for sponsors and distributors,” said Ashley Alder, Chair of the IOSCO Board.

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