IOSCO Charts Path for Global Crypto Regulation

In a pivotal move, the International Organization of Securities Commissions (IOSCO) has unveiled its comprehensive policy recommendations for Crypto and Digital Asset (CDA) markets. IOSCO, serving as the global standard setter for securities market regulators, is addressing the pressing need for a unified international regulatory approach to counter risks posed by centralized crypto asset service providers (CASPs).

The report meticulously outlines six key areas of focus: conflicts of interest, market manipulation, custody and client asset protection, cross-border risks and regulatory cooperation, operational and technological risk, and retail distribution. These recommendations establish a robust global regulatory baseline, ensuring that CASPs adhere to the same standards of business conduct as seen in traditional financial markets.

Jean-Paul Servais, IOSCO Chair, emphasized the significance of the report in fostering investor protection and fair, efficient, and transparent operations within crypto-asset markets. Tuang Lee Lim, Chair of the IOSCO Board-Level Fintech Task Force, highlighted the consistency between the regulatory approach for CASPs and established IOSCO Principles for Securities Regulation.

The recommendations aim for a “same activity, same risk, same regulatory outcome” principle, promoting outcomes-focused measures. As the G20 and FSB envision an international framework for crypto markets, IOSCO’s report is a crucial step in this direction.

The report also underscores the mirroring of CASP activities and risks with those observed in traditional financial markets. This aligns with IOSCO’s principles and standards for securities market regulation. The board, comprising 35 regulators globally, emphasizes optimal consistency in regulating crypto-asset markets across IOSCO member jurisdictions.

IOSCO’s latest initiative builds upon its prior reports on DeFi, stablecoins, and influencers. The organization continues to be at the forefront of shaping global regulatory standards for emerging financial technologies. As the crypto landscape evolves, IOSCO remains committed to strengthening investor protection and market integrity.