Crypto should mimic TradFi rules: Global securities regulator IOSCO

cointelegraph.com:

A major global securities watchdog, the International Organization of Securities Commissions (IOSCO), is working to help policymakers regulate cryptocurrency more effectively.

IOSCO on May 23 released a set of crypto-related regulatory recommendations as part of a consultation report developed by the IOSCO Board’s Fintech Task Force.

The report includes 18 policy recommendations to help global securities regulators address market integrity and investor protection concerns arising from crypto. Following the consultation period through the end of July, IOSCO plans to finalize the recommendations by late 2023.

In Chapter 1, IOSCO set out an overarching recommendation addressed to all regulators, advising policymakers not to create any disparities in regulating cryptocurrency and traditional finance.

Crypto regulators around the world should seek to achieve regulatory outcomes that are “same as, or consistent with those required in traditional financial markets,” IOSCO suggested. According to the authority, such recommendations should help facilitate a “level-playing field between crypto-assets and traditional financial markets” and reduce the risk of regulatory arbitrage. IOSCO wrote:

IOSCO also encouraged global regulators to analyze the applicability and adequacy of their crypto regulatory frameworks and the extent to which they behave like substitutes for regulated financial instruments. Regulators should apply such an approach to all types of crypto assets, including stablecoins like Tether (USDT), the authority noted.

Established in 1983, IOSCO is an association of organizations regulating the world’s securities and futures markets. IOSCO’s Board is the governing and standard-setting body of its constituent members.