Our new episode of FInsight: Global Financial Institutions Industry Podcast focuses the regulatory development f cryptoassets, following our recent publication Crypto around the World. The speakers for this episode are Sue McLean, partner and global tech lead for fintech from our London office; Iris Barsan, counsel from our Paris office; Julian Hui, senior associate from our London office, and Chris Murrer, a US attorney based in our Switzerland office. In this second part, we cover market abuse, sustainability, decentralized finance, and future developments.
Key highlights of the episode include:
- There are varying approaches how regulators tackle market abuse and similar types of risks related to cryptoassets, but there are loopholes. New EU rules on cryptoassets are designed to close some of these loopholes.
- Environmental-, Social-, and Governance-related concerns need clarity, and should address these primary questions:
- Is crypto itself green?
- Can you invest in crypto if you have ESG-related investment criteria and parameters?
- Can you use crypto to promote ESG-related initiatives around voting rights, gender equality, employee relations, and others?
- Decentralized finance (DeFi) – a form of finance that does not rely on certain financial intermediaries like brokerages, exchanges, and banks – should be on everyone’s radar moving forward. DeFi can promote better financial inclusion, but it also gives rise to volatility and market concerns.
- Investors should consider the future impact of central bank digital currencies. This may have big ramifications from a monetary policy perspective by allowing governments to get much more involved directly with individuals.
New developments will give rise to new legal questions – with regulatory intervention sure to follow. The landscape for cryptoassets continue to evolve and advance, with boundaries being challenged at every step.