Latest news with #RegulationATS
Yahoo
22-04-2025
- Business
- Yahoo
5 Ways the SEC Can Embrace Innovation
The U.S. Securities and Exchange Commission has long been the world's most influential financial regulator, helping to ensure our capital markets are the deepest, fairest, and most accessible in the world. But its continued relevance will depend on whether it can do more than merely respond to innovation — it must proactively foster it. For nearly a century, the SEC has adapted to evolving markets, new technologies and greater retail participation. In its best moments, the agency has embraced innovation in service of transparency, investor protection, and capital formation. But in recent years, it has strayed from that legacy — nowhere more visibly than in its approach to crypto and good news is, with a change in leadership and a more open posture emerging, the SEC has a chance to course-correct. But the bigger question is: how do we make that change permanent? How do we build innovation into the SEC's DNA so that the next promising financial technology isn't strangled in its crib? I spent nearly six years at the SEC, first as a Senior Counsel in the Division of Enforcement and then as Chief Counsel in the Office of Legislative and Intergovernmental Affairs. I've since held senior legal and policy roles in crypto firms across the ecosystem. From both perspectives, one thing is clear: the SEC can fulfill its mission more effectively — and maintain its global leadership — only if it becomes a proactive partner in financial innovation. The SEC has a proud history of embracing change to the benefit of investors and markets alike. In the 1990s, it digitized corporate filings through EDGAR, replacing paper documents with searchable databases. It later approved Regulation ATS, enabling the rise of alternative trading systems that increased competition and liquidity. ETFs, which were once novel, are now mainstream products that offer low-cost, diversified exposure to a wide range of assets. More recently, fractional-share trading has empowered millions of retail investors to own a slice of companies they once could only admire from afar. One especially relevant example as the SEC thinks about how to regulate crypto is the agency's treatment of asset-backed securities. In the 1980s and 1990s, the SEC recognized that these complex financial products didn't fit neatly into existing disclosure regimes. After years of study and no-action letters, it developed a tailored disclosure framework in 2004 — refined further in 2014 — that balanced innovation with investor protection. And it didn't need to bring hundreds of enforcement actions to do it. There are also times the SEC failed to adapt, to the detriment of both investors and markets. It was slow to respond to the rise of high-frequency trading, contributing to the 2010 Flash Crash. It took years to implement the crowdfunding rules authorized by the JOBS Act. It lagged on digital reporting standards, delaying broader access to market data. And, for much of the last few years, its stance on crypto veered from caution to outright hostility. Instead of issuing clear rules for digital assets, the agency pursued a scattershot enforcement campaign — often against firms that were seeking to comply in good faith. Many of these actions didn't even involve fraud or investor loss. Meanwhile, American crypto companies fled overseas, and a global industry flourished without us. Even the SEC's grudging approval of spot bitcoin ETFs in 2024 came only after it was forced by a federal court. And while the agency at one point talked about creating a crypto disclosure framework akin to what it did for ABS, it never followed through. Crypto may be new, but the SEC has faced this challenge before. It knows how to modernize its rules to meet new realities. What's different now is the opportunity to leverage innovation — not just regulate it. Take blockchain technology. It could enable near-instant trade settlement, reducing risk and freeing up capital. It could improve market transparency through immutable records and real-time transaction data. It could lower operational costs by reducing intermediaries. And tokenization could expand access to private markets and hard-to-reach asset classes, benefiting both issuers and investors. Ironically, the SEC hasn't seriously explored how blockchain could improve its own market oversight. That's a missed opportunity. But it's not too late. So what would it look like to build innovation into the SEC's core mission? Revise the SEC's Mandate: Congress should amend the Securities Exchange Act of 1934 to explicitly include the promotion of innovation and modernization, alongside investor protection, market integrity, and capital formation. Rethink Metrics of Success: The SEC shouldn't measure success solely by the number of enforcement actions or penalties collected. It should also look to capital formation, investor confidence, and the safe adoption of new technologies. Create an Innovation Office: A dedicated, empowered team should engage with entrepreneurs, technologists, and academics to guide responsible innovation — just as similar offices in the U.K. and Singapore have done. Adopt Risk-Based Regulation: Not every new product or platform needs full regulatory treatment on day one. Pilot programs, safe harbors, and regulatory sandboxes can help innovators test ideas while maintaining appropriate guardrails. Invest in Education and Training: SEC staff need better fluency in emerging technologies. Cross-disciplinary expertise should be rewarded and cultivated. These are not radical ideas — they are proven tools drawn from the SEC's own playbook. In a global race to define the future of finance, the SEC has a choice: lead or fall behind. Its greatest strength has always been its credibility and ability to adapt. The next generation of investors and entrepreneurs won't wait around for 20th-century rules to catch up to 21st-century innovation. Nor should they have to. If the SEC wants to remain the gold standard, it must adapt once again — not just to the present, but to what comes in to access your portfolio
Yahoo
11-03-2025
- Business
- Yahoo
SEC's Uyeda Plans to Strike Crypto From Trading System Proposal
(Bloomberg) -- A Securities and Exchange Commission proposal requiring digital asset exchanges to register under alternative trading system rules is in for an overhaul. NJ College to Merge With State School After Financial Stress NYC Congestion Pricing Toll Gains Support Among City Residents Where New York City's Zoning Reform Will Add Housing Buffalo's Billion-Dollar Freeway Fix Is on Ice, But Not Because of Trump Inside the 'Not Architecture' of High Line Designers Diller Scofidio + Renfro Acting SEC Chair Mark Uyeda said Monday that he has asked staff to pare back parts of the rule, which was proposed in 2022 and would have broadened the definition of an 'exchange.' At the time, regulators said the measure would close a regulatory gap created by certain platforms. The move garnered major industry opposition from the likes of Coinbase Global Inc., who said it would dramatically curtail their operations. 'In my view, it was a mistake for the Commission to link together regulation of the Treasury markets with a heavy-handed attempt to tamp down the crypto market,' Uyeda said in his planned remarks at an Institute of International Bankers conference in Washington. The regulator is now considering whether and how to bring the proposed rule back to its original intent, initially put forward during the first Trump administration, to encompass proprietary trading firms that actively trade US Treasuries. Proprietary trading firms should be subject to the same regulatory treatment as banks and other firms that conduct much of the transactions in the US bond market, Uyeda said. 'Despite being dependent on sophisticated technology, ATSs that trade US government securities are not subject to the transparency, fair and orderly markets, investor protections, and system integrity rules that apply to ATSs generally,' Uyeda said. An alternative trading system is a trading platform for buyers and sellers of securities, including US Treasuries, that aren't required to register as exchanges with the SEC. That's conditional on them complying with the requirements of Regulation ATS, which includes registering with the commission as a broker-dealer. Uyeda didn't provide a time frame for when or whether the agency might re-propose the rule or move to vote on a revamped final rule. Major rulemakings tend to take many months, so it's possible any future move could come after Paul Atkins, President Donald Trump's choice to lead the SEC, is confirmed by the Senate. How Natural Gas Became America's Most Important Export Germany Is Suffering an Identity Crisis 80 Years in the Making The Mysterious Billionaire Behind the World's Most Popular Vapes Disney's Parks Chief Sees Fortnite as Key to Its Future Greenland Voters Weigh Their Election's Most Important Issue: Trump ©2025 Bloomberg L.P. Sign in to access your portfolio
