FINRA (the Financial Industry Regulatory Authority) – the self-regulatory body responsible for US brokerage firms and exchanges – has issued a request for members to submit information about their crypto activities.
In a notice published on Friday, the organisation wrote that the warning is to “encourage each firm to promptly notify FINRA” if they are engaged in or intend to engage in any activities relating to crypto-assets or digital currencies.
Formed in 2007 as a consolidation of other pre-existing industry bodies, FINRA has continued its cautious approach to the crypto industry, with the notice explaining:
“The market for digital assets…has grown significantly and has increasingly been of interest to retail investors. At the same time, investor protection concerns exist, including incidences of fraud and other securities law violations involving digital assets and the platforms on which they trade.”
Advising all members of the relevant FINRA and SEC rules, the notice also explains that they want to be informed if any firm intends to trade crypto-assets, accept them from members, participate in token sales, recommend cryptocurrencies or tokens, or mine cryptocurrencies.
This latest warning is one of many statements in recent months from regulatory bodies to acknowledge the enormous growth of the industry, yet encourage a cautious approach.
At the end of June, the Bank of England’s Prudential Regulatory Authority issued a letter warning CEOs of banks, insurers and investment firms of the risks associated with crypto-assets.
With the UK crypto industry’s own regulatory body – Crypto UK – responding to the letter and encouraging clear dialogue between the industry itself and regulators, it will be interesting to see if the US industry – the world’s largest crypto-economy – can establish a similar relationship.