The International Organization of Securities Commissions (IOSCO), the umbrella group for global markets regulators, on Tuesday, published guidelines for authorities toughening their standards for regulating crypto asset and digital markets, drawing on lessons from last year’s collapse of the FTX exchange that fuelled concerns over consumer protection.
Tuesday’s recommendations are a “turning point in addressing the obvious and proximate risks to investor protection and market integrity risks,” said Jean-Paul Servais, who chairs the International Organization of Securities Commissions (IOSCO). The proposed standards cover dealing with conflicts of interest, market manipulation, cross-border regulatory cooperation, custody of cryptocurrencies, operational risks, and treatment of retail customers.
In a conversation with Financial Times, Iosco secretary-general Martin Moloney said “The diversity we’ve got at the moment across jurisdictions is not that they’re moving in different directions, but that they haven’t gone far enough in the direction that they all know they should go in.” He also added, “What we would say to jurisdictions is just push ahead. They’ve all got different legal frameworks, different regulatory frameworks. Just push ahead, and do it to this standard as quickly as possible. It’s not helpful for anyone to hold back at this point.”
The 18 measures planned apply long-established safeguards from mainstream markets to eliminate conflicts of interest between the different parts of a crypto transaction.
The watchdog said it aimed to finalize the standards by the end of the year, and expected its 130 members worldwide to use them to plug gaps in their rulebooks promptly.
Is Cryptocurrency Legal in India?
No central authority in India regulates the use of cryptocurrencies as a form of payment. When dealing with cryptocurrencies, there are no established norms or rules for resolving conflicts. Trading in cryptocurrencies is thus done at the risk of investors.
Nirmala Sitharaman, India’s finance minister, suggested taxing digital assets, which has stoked more discussion about whether cryptocurrencies are allowed there. While many have welcomed the government’s move to tax virtual currencies as the first step towards recognizing them, no formal statement has been made by the government about the legality of such currencies in India.
One might get the conclusion that cryptocurrencies are unlawful but that there isn’t a firm prohibition on them in India based on several important remarks made by the governor of the Reserve Bank of India and other government spokespersons, including the nation’s finance minister. Although they are unregulated, the Indian government recently promised a 30% tax on cryptocurrency earnings and a 1% tax deducted at source as part of the Union Budget 2022.
