Global Financial Regulatory Blog

Category Archives: Fintech and Cryptocurrency

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FCA Publishes Business Plan for 2023/24

The Future Regulatory Framework and Consumer Duty will be key areas of focus for the coming year. By Rob Moulton, Nicola Higgs, David Berman, Becky Critchley, and Charlotte Collins On 5 April 2023, the FCA published its Business Plan for 2023/24. The Business Plan sets out a number of priority areas for the regulator, tied … Continue Reading

ISDA Launches Version 1.0 of Definitions for Digital Asset Derivatives

The Definitions aim to support the safe and efficient development of the digital asset derivatives market through consistent contractual standards. By Yvette D. Valdez, Thomas Vogel, Naffie Lamin, Tiiu Lemsalu, and Deric Behar On January 26, 2023, the International Swaps and Derivatives Association, Inc. (ISDA) published version 1.0 of the long-awaited ISDA Digital Asset Derivatives Definitions (the … Continue Reading

Hong Kong’s New Crypto Regulatory Framework to Facilitate Greater Institutional Participation

Regulators released comprehensive guidance to banks, intermediaries, and insurers on virtual asset-related activities. By Simon Hawkins and Adrian Fong On 28 January 2022, Hong Kong’s principal financial services regulators issued much-anticipated guidance to banks, securities firms, and insurers looking to undertake activities related to virtual assets (VAs). In particular: The Hong Kong Monetary Authority (HKMA) … Continue Reading

UK to Regulate Cryptoasset Promotions

HM Treasury has confirmed that it will bring certain unregulated cryptoassets within scope of the financial promotions regime. By Stuart Davis, Rob Moulton, and Charlotte Collins On 18 January 2022, the UK government confirmed its intention to bring the promotion of certain cryptoassets into scope of regulation. HM Treasury has been considering for some time … Continue Reading

Private Bank Briefing – September 2021

By Rob Moulton, Nicola Higgs, Anne Mainwaring, and Charlotte Collins The latest edition of our Private Bank Briefing provides a roundup of legal and compliance issues impacting private banks and their clients from Q3 2021. In this edition, we include a summary of the latest sustainable finance developments, and pinpoint areas of post-Brexit regulatory divergence in relation … Continue Reading

Taskforce Proposes New Approach to Financial Regulation in the UK

A report from the Taskforce on Innovation, Growth and Regulatory Reform provides recommendations for how the UK can “re-imagine” its approach to regulation post-Brexit. By Rob Moulton, Stuart Davis, and Charlotte Collins On 16 June 2021, the Taskforce on Innovation, Growth and Regulatory Reform (the Taskforce) published a report (the Report) providing recommendations for how … Continue Reading

ESG and Cryptocurrency: Considerations for Market Participants

For market participants pivoting toward ESG and digital assets, weighing the issues at the crossroads of these two megatrends is critical. By Paul A. Davies, Stuart Davis, Simon Hawkins, Nicola Higgs, Yvette D. Valdez, Thomas Vogel, Stephen P. Wink, and Deric Behar The huge rise in popularity of Bitcoin — and the growing interest by … Continue Reading

Implementing Technology Change — Successes and Pitfalls in Financial Services

An FCA report evaluates the chequered implementation of technology change and identifies risks and best practices to help firms better navigate this change. By Andrew C. Moyle, Alain Traill, and Jagveen S. Tyndall Of the nearly 1,000 “material incidents” reported to the UK’s Financial Conduct Authority (FCA) in 2019, 17% were caused by change-related activity. … Continue Reading

What the CFTC Interpretation of “Actual Delivery” Means for Crypto

The long-awaited guidance clarifies the application of the “actual delivery” exception to leveraged virtual currency transactions with retail purchasers. By Yvette D. Valdez, J. Ashley Weeks, and Deric Behar Earlier this year, the US Commodity Futures Trading Commission (CFTC) approved final interpretive guidance (Guidance) concerning retail commodity transactions involving certain digital assets. The Guidance clarifies … Continue Reading

European Parliament Calls for New EU Common Framework for Cryptoassets

An ECON draft report on digital finance recommends legislative action in relation to cryptoassets and cyber resilience and a framework for digital onboarding. By Stuart Davis, Sam Maxson, and Anna Lewis-Martinez On 4 June 2020, the European Parliament’s Economic and Monetary Affairs Committee (ECON) published a draft report setting out its recommendations to the European … Continue Reading

Singapore: Payment Token Derivatives – to Offer or Not to Offer?

MAS confirms regulatory approach for derivative contracts on payment tokens. By Farhana Sharmeen and Marc Jia Renn Tan On 15 May 2020, the Monetary Authority of Singapore (the MAS) issued its response to feedback about its proposed regulatory approach for derivative contracts that reference payment tokens as underlying assets (Payment Token Derivatives), confirming that it … Continue Reading

Financial Institutions and the Cloud: How to Navigate an Evolving Regulatory Landscape

Insights from Latham’s flagship event: Managing the risk and promise of digitisation in financial services. By Fiona Maclean, Stuart Davis, and Alistair Wye In a bid to keep pace with rapid advances in cloud adoption across financial services, regulators have published a raft of new guidance in the past year. Most recently, the European Insurance … Continue Reading

Will Regulatory Reform Make Cryptoassets the Next Buyout Boom for Private Equity?

Regulatory guidance on cryptoassets and digital currency companies may lead to a legitimisation of crypto-businesses as an investable asset class. By Stuart Davis, Sam Maxson, David Walker, Tom Evans, and Catherine Campbell Recent and upcoming regulatory guidance on cryptoassets and the regulation of companies engaged in digital currency, such as issuers, crypto-exchanges, crypto-custodians, crypto-brokers, and … Continue Reading

FCA Publishes Policy Statement Extending Rules to Payment Services and E-Money Sectors

From August 2019, certain existing FCA rules and guidance will extend to payment service providers and e-money issuers in a signal that the FCA wants a consistent approach to consumer protection. By Rob Moulton, Brett Carr, and Frida Montenius The FCA has published a Policy Statement extending certain rules and guidance to the payment services … Continue Reading

Private Equity and Blockchain: New Infrastructure or New Asset Class?

By Andrew Moyle and Stuart Davis Growth in applications for blockchain and tokenisation, combined with an increasing number of initial coin offerings (ICOs), mean that buyout firms should note developments in this sector. Why Should PE Be Interested in Blockchain? A shared blockchain ledger could drive a single interface between a PE fund and its investors, … Continue Reading

FCA to Create Global Financial Innovation Network

FCA teams up with other regulators to advance its idea of creating a global regulatory sandbox. By Stuart Davis, Gabriel Lakeman, Sam Maxson, Brett Carr and Charlotte Collins The FCA, along with several other financial services regulators, has launched a consultation on the operating framework for a Global Financial Innovation Network (GFIN). This is an evolution … Continue Reading

UK Financial Services Regulators Warn Firms About Risks of Exposure to Crypto-assets

Both the FCA and the PRA have written to firms to warn about certain risks associated with exposures to crypto-assets, and to advise firms of the measures they should consider implementing to mitigate such risks. By Stuart Davis and Charlotte Collins The FCA and the PRA have each written a “Dear CEO” letter to firms, … Continue Reading

FCA Sets Expectations for Robo-Advisers

Many auto advisers and automated discretionary investment managers risk poor outcomes for customers by falling short of FCA expectations. By Nicola Higgs and Brett Carr The Financial Conduct Authority (FCA) has issued a statement outlining its expectations of firms providing automated online discretionary investment management (ODIM) services and retail investment auto advisers (auto advisors). The … Continue Reading

Cryptocurrencies and Prepaid Cards Face Closer AML Regulation in the EU

New EU anti-money laundering measures have been approved by European legislators. By Stuart Davis and Charlotte Collins The European Parliament and Council have finally signed off on the text of the fifth Anti-Money Laundering Directive (known as MLD5). Overview The new directive is of particular interest to the FinTech sector as, amongst other things, MLD5 … Continue Reading

FCA Statement on Cryptocurrency Derivatives

FCA warns providers of cryptocurrency derivatives of their regulatory obligations. By Andrew Moyle, Stuart Davis and Charlotte Collins The UK Financial Conduct Authority (FCA) has issued a statement reminding businesses offering cryptocurrency derivatives of the requirement to be authorised. The FCA explains that, although cryptocurrencies are not themselves regulated in the UK, derivatives that reference … Continue Reading

UK Government’s First FinTech Sector Strategy Launched at the International Fintech Conference

The Strategy emphasises the UK government’s continued push to create a world-leading FinTech sector. By Stuart Davis, Charlotte Collins and Sam Wong At the second International Fintech Conference held on 22 March 2018, Philip Hammond, Chancellor of the Exchequer, announced the launch of the UK’s first Fintech Sector Strategy. The Strategy includes the following key … Continue Reading

Swiss Regulator Publishes ICO Guidelines

Swiss regulator offers assistance in navigating the regulatory framework. By Andrew Moyle, Stuart Davis and Charlotte Collins The Swiss Financial Market Supervisory Authority (FINMA) has published a set of guidelines, setting out how it intends to apply its financial markets legislation in the context of initial coin offerings (ICOs). Despite the growing trend for ICOs … Continue Reading

FCA to Take a Closer Look at ICOs

By Stuart Davis and Charlotte Collins Following on from the Financial Conduct Authority’s (FCA’s) consumer warning on Initial Coin Offerings (ICOs) in September, the FCA has announced a deeper examination of this area in its Feedback Statement on Distributed Ledger Technology (DLT) and related press release. The FCA stated that it will consider whether regulatory … Continue Reading

UK Budgets for Fintech Growth

By Andrew Moyle and Stuart Davis The UK government’s 2017 Autumn Budget included some measures of particular interest for fintech firms, demonstrating the government’s continued commitment to making the UK a world-leading fintech hub. The government has provided only scant detail on these measures at present, but no doubt firms will be watching closely to … Continue Reading
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