IOSCO Unveils Global Crypto Regulation and Digital Markets Strategy

  • The sector advocates for a universal regulatory approach to address jurisdictional variations.
  • FTX’s liquidity crisis prompted international actions, prompting regulatory intervention.

On Tuesday, the International Organization of Securities Commissions (IOSCO) introduced a groundbreaking worldwide strategy for overseeing crypto assets and digital markets, Reuters reported.

This regulatory framework incorporates valuable insights from the FTX exchange’s collapse in the previous year, which raised significant apprehensions regarding safeguarding consumer interests.

Amid concerns over varying rules in different jurisdictions, the sector is calling for a universal regulatory approach. This call comes in the wake of the FTX exchange’s liquidity crisis and subsequent U.S. bankruptcy proceedings, prompting global regulatory intervention.

Jean-Paul Servais, the chairperson of IOSCO, described the recommendations unveiled on Tuesday as a significant milestone in addressing the immediate and evident risks to investor protection and market integrity.

IOSCO proposed 18 measures to regulate crypto transactions, aiming to eliminate conflicts of interest. These measures apply established safeguards from traditional markets. IOSCO plans to finalize the standards by year-end and expects its 130 members worldwide to promptly adopt them.

The proposed standards encompass a wide range of areas, including addressing conflicts of interest, combating market manipulation, promoting cross-border regulatory cooperation, establishing guidelines for crypto asset custody, mitigating operational risks, and ensuring appropriate treatment of retail customers.

Public input is being sought on the regulations. This move follows the European Union’s recent implementation of comprehensive crypto rules, which puts pressure on other countries to develop their own norms.

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