SEC wants big data tools for monitoring and enforcing cryptocurrency market compliance
Modern Consensus | ,
Move is latest series of steps by regulator to bring clarity and less confrontational approach to regulations enforcement
The U.S. Securities and Exchange Commission wants to know if the technology to help it monitor major cryptocurrency blockchains for risk and regulatory compliance issues exists.
The SEC is not looking to buy big data analytics tools at this time, but characterizes its interest as “conducting market research to determine the availability and technical capability,” of the tools presently available on the market, it announced in a notice on Jan. 31
What the SEC wants to know about is the “ability to provide the requested data but also an overview of the processes used to extract the data, convert the data into a reviewable format, and the verification steps to ensure there is no loss in data completeness and accuracy due to the data transformation tools and processes applied.”
The software it wants would also make the data easy for SEC staff to read and understand on an ongoing basis, and would provide insights about that data—notably identifying who the data belongs to—as well as a way of ensuring the data is accurate and complete.
See: Designing a data transformation that delivers value right from the start
The request is the latest in a series of recent moves that underline the agency’s commitment to bringing order, clarity, and oversight to the regulation of the cryptocurrency and digital asset market, as well as moving away from the confrontational approach that have characterized its actions in recent years. The SEC’s Office of Compliance Inspections and Examinations (OCIE) identified digital assets as one of its priorities for 2019, including firms’ portfolio management, internal controls, and asset security among its focuses.
The SEC recently promised “plain English” guidance for developers and investors that will make clear if their cryptocurrencies and initial coin offerings (ICO) qualify as securities under the law, according to “The Distributed Ledger: Blockchain, Digital Assets and Smart Contracts,”
a report issued in November 2018 by the white shoe law firm Skadden, Arps, Slate, Meagher, and Flom.
That recent promise by William Hinman, director of corporation finance at the SEC, highlights what Skadden calls the agency’s “recent efforts to encourage engagement and collaboration with developers regarding their blockchain-related projects rather than emphasizing enforcement actions.”
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University of Pennsylvania | Wharton Knowledge | Sep 10, 2019 As the finance industry grapples with what the next generation of banks and payment systems will look like, it’s clear that partnerships are a linchpin for riding the wave of change successfully, whether you’re a multibillion-dollar traditional bank or a startup looking to bring cutting-edge technology into the mainstream. “The rails that these payment systems are built on date back 20-30 years – people are not starting to reinvent that alone; it isn’t an overnight thing – it’s incremental innovation adding up to something massive,” said Jennifer Lee, vice president focused on fintech at growth equity firm Edison Partners during the recent Fearless in Fintech conference at Wharton San Francisco. At the conference, which was co-sponsored by Knowledge@Wharton and Wharton Executive Education and organized by Momentum Event Group, Denise Leonhard, head of global credit expansion, business development and expansion at Paypal, used her company’s online payments system as an example of the challenges ahead. “We’ve built our infrastructure with all these different partners – payment networks, bank issuers … we’re all playing in a very messy soup,” she said. “What we’ve been building in the last 20 years has brought ...
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Read More
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NCFA Guest Post | Sep 9, 2019 The world was shook when online money was first introduced. Some people didn’t like the idea. They’d prefer having something tangible, something that they can actually see and touch to use as currency. Some people were positive about the new experience. They believe that it can certainly make life more convenient. But hey, we’re now in 2019 and online currency is still widely in use. In fact, its uses have expanded way more since it was first introduced (read more). One of the most popular and controversial of its time was BTC or Bitcoin. Even without studying cryptocurrencies, you’ve probably heard this term once or twice before. You may have come across it in the internet or someone may have encouraged you to try trading it. After all, when cryptocurrency was first brought to light, many people saw its potential in the trading market. And it has been making noise ever since. See: New Regulatory Framework for Canadian Retail Payments Coming in 2019 At first, Bitcoin was surrounded with a lot of controversy – and of course, a lot of doubt. People were scared of exchanging real world money for something that you ...
Read More
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Read More
Read More
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Read More
Read More
FCA | Sep 11, 2019 Speech by Christopher Woolard, Executive Director of Strategy and Competition at the FCA, delivered at the Cambridge Centre for Alternative Finance annual conference, Judge Business School. Highlights: The UK has led the rest of the world with developments like the regulatory Sandbox, we are very proud of what has been achieved through it. Early engagement is incredibly valuable for monitoring, supervisory and policy purposes. Working with innovative firms helps us achieve a better bird’s-eye view, enhancing our understanding when the overall landscape is blurry and changing quickly. 'Stablecoin' is a term that has been widely adopted by industry, but we do not take it to be a distinct category of cryptoassets. Something labelled as a 'stablecoin' could sit within or outside of our regulatory perimeter. Note: this is the speech as drafted and may differ from the delivered version. See: FCA confirms new rules for P2P platforms Last month, Facebook announced its plans for Libra, the stablecoin it is planning to launch in conjunction with a number of payment and tech firms. As has been widely reported, along with other regulators and central banks, we have been discussing their plans with Facebook. If this comes ...
Read More
Read More
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Read More
Read More
TechCrunch | Kate Clark | Sep 12, 2019 Affirm, founded by PayPal’s Max Levchin, is said to be raising as much as $1.5 billion in a combination of debt and equity, according to people with knowledge of the company’s fundraising activities. Josh Kushner’s New York venture capital firm Thrive Capital is said to be leading the financing, with participation from the San Francisco outfit Spark Capital. Affirm declined to comment. Representatives of Thrive and Spark, existing Affirm investors, have not responded to a request for comment. Sources familiar with Affirm, which gives consumers an alternative to personal loans and credit by financing online purchases at point-of-sale, presume the round will be made up largely of a line of credit from a large financial institution, known as a warehouse facility. Affirm recently raised a $300 million Thrive-led Series F round in April at a valuation of $3 billion. Fintech companies focused on payments and lending, however, require a vast amount of capital to sustain operations. Those capital requirements coupled with the frothiness of the venture capital market justify this additional cash infusion. To date, Affirm has raised $1.03 billion in funding from Ribbit Capital, Founders Fund, Andreessen Horowitz, Khosla Ventures, Lightspeed ...
Read More
Read More
Le Monde with AFP | Sep 12, 2019 Bruno Le Maire expressed his hostility towards this cryptocurrency project, saying that "the monetary sovereignty of states is at stake" Finance Minister Bruno Le Maire announced on Thursday (September 12th) that France was refusing to authorize the development "on European soil" of libra, the cryptocurrency that Facebook wants to launch in 2020. "Considerable financial disorder" "The monetary sovereignty of states is at stake," said the minister at the opening of a conference of the Organization for Economic Co-operation and Development (OECD) dedicated to the challenges of cryptocurrencies - without specifying, however, what concrete measures he wanted engage to prevent the spread of libra in Europe. See: Facebook’s Libra Cryptocurrency: Everything We Know In his speech, Bruno Lemaire described as "systemic" the risks that could result from this "possible privatization of a currency (...) held by a single actor that has more than 2 billion users on the planet" . "Any failure in the functioning of this currency, in the management of its reserves, could create considerable financial disorders , " justified the Mayor, also fearing that the libra is replacing the national currency in the States where the currency is weak or ...
Read More
Read More
CNBC | Bob Pisani | Sep 10, 2019 Key Points The head of the SEC says more needs to be done to make it easier for companies to go public. Jay Clayton says his office is taking a “fresh look” at allowing Main Street investors access to the private capital markets. The head of the SEC says more needs to be done to make it easier for companies to go public and that his office is taking a “fresh look” at allowing Main Street investors access to the private capital markets. In a speech to the Economic Club of New York on Monday, SEC Chairman Jay Clayton said the lack of more IPOs and the inability of most of the Main Street investing public to access private markets was a “growing concern.” Clayton addressed what he called the “two segments” in capital markets: the public markets, and private ones, including private equity and venture capital investments. See: The Solution To The Fintech IPO Shortage “Twenty-five years ago, the public markets dominated the private markets in virtually every measure,” he said. “Today, in many measures, the private markets outpace the public markets, including in aggregate size.” Clayton wants to make the ...
Read More
Read More
Nesta UK | Rosalyn Old and Johnathan Bone | Sep 4, 2019 Earlier in May 2019, Nesta commissioned a report called 'Taking Ownership: Community Empowerment through Crowdfund Investments' that looked at how community-led projects have the power to transform local areas socially, economically and environmentally and how institutions such as local governments, municipal authorities and foundations, can help community-led initiatives by making the most of new investment crowdfunding models (eg community shares and bonds). Key Findings Investment crowdfunding has been used to fund a broad range of local assets, including but not limited to, saving local shops and pubs from closure, creating new community centres and art spaces, and expanding leisure facilities and infrastructure projects. Potential opportunities in using investment crowdfunding for community-led initiatives include helping to fund projects that would otherwise struggle to access finance elsewhere, increasing the use of and volunteering for community initiatives, and strengthening local resilience and self-determination by bringing communities together to improve their area. The main challenges for community organisations raising money in this way include gaining access to assets to buy or use on a temporary basis, transitioning from grassroots fundraising to implementing a project and avoiding negative impacts on diversity and inclusion ...
Read More
Read More
NCFA Canada on behalf of our partner's Lending Loop | Sep 11, 2019 HAVE YOU EVER SEEN A CHESHIRE CAT SMILE? Well they deserve it. Back in October 2015, NCFA made this introductory video with Cato Pastoll, CEO and Co-Founder of Lending Loop, about a peer to peer lending marketplace for small businesses model that was new to Canada but was achieving significant growth internationally. The question and opportunity was back then: why not here in Canada? A question that many of us ask ourselves, ask the community and point fingers at strict regulations and high operating costs. Well fast forward several years and growth obstacles later, and the Lending Loop story continues to impress with their latest milestone of lending over $50 million to deserving small businesses to help them grow and expand operations while providing retail and accredited investors direct access to a wide range of lending and investment options, a robust community and the chance to strengthen Canadian small business - here here! The early vision... Brandon Vlaar, Co-founder and CTO of Lending Loop sharing their good news! CONGRATS to the entire Lending Loop Team for achieving this latest milestone. We've 'got your back' and look forward ...
Read More
Read More
NCFA Guest Post | Sep 9, 2019 The world was shook when online money was first introduced. Some people didn’t like the idea. They’d prefer having something tangible, something that they can actually see and touch to use as currency. Some people were positive about the new experience. They believe that it can certainly make life more convenient. But hey, we’re now in 2019 and online currency is still widely in use. In fact, its uses have expanded way more since it was first introduced (read more). One of the most popular and controversial of its time was BTC or Bitcoin. Even without studying cryptocurrencies, you’ve probably heard this term once or twice before. You may have come across it in the internet or someone may have encouraged you to try trading it. After all, when cryptocurrency was first brought to light, many people saw its potential in the trading market. And it has been making noise ever since. See: New Regulatory Framework for Canadian Retail Payments Coming in 2019 At first, Bitcoin was surrounded with a lot of controversy – and of course, a lot of doubt. People were scared of exchanging real world money for something that you ...
Read More
Read More
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