In a welcome development for blockchain and cryptocurrency firms, the U.S. securities regulator has launched its Strategic Hub for Innovation and Financial Technology.
SEC Announces FinHub
The U.S. Securities and Exchange Commission (SEC) has announced the launch of FinHub, its Strategic Hub for Innovation and Financial Technology. The announcement was made earlier through a press release on the agency’s official website.
According to the announcement:
The FinHub will serve as a resource for public engagement on the SEC’s FinTech-related issues and initiatives, such as distributed ledger technology (including digital assets), automated investment advice, digital marketplace financing, and artificial intelligence/machine learning. The FinHub also replaces and builds on the work of several internal working groups at the SEC that have focused on similar issues.
FinHub will be led by Valerie A. Szczepanik, Senior Advisor for Digital Assets and Innovation and Associate Director in the SEC’s Division of Corporation Finance. She will be assisted by staff from other divisions from the agency with expertise in fintech.
For blockchain and cryptocurrency start-ups that are looking to raise funds by hosting an ICO, this platform will provide an opportunity to bounce their ideas off the agency’s staff at an early stage of the project. This should help the projects gain early and quick insight with respect to the regulatory compliance perspective.
FinHub’s Role and Responsibilities
Talking about this aspect, the press release further elaborates that FinHub will:
- Provide a portal for industry and the public to engage directly with SEC staff on innovative ideas and technological developments;
- Publicize information regarding the SEC’s activities and initiatives involving FinTech on the FinHub page;
- Engage with the public through publications and events, including a FinTech Forum focusing on distributed ledger technology and digital assets planned for 2019;
- Act as a platform and clearinghouse for SEC staff to acquire and disseminate information and FinTech-related knowledge within the agency; and
- Serve as a liaison to other domestic and international regulators regarding emerging technologies in financial, regulatory, and supervisory systems.
SEC Chairman Jay Clayton said:
The SEC is committed to working with investors and market participants on new approaches to capital formation, market structure, and financial services, with an eye toward enhancing, and in no way reducing, investor protection.
The FinHub provides a central point of focus for our efforts to monitor and engage on innovations in the securities markets that hold promise, but which also require a flexible, prompt regulatory response to execute our mission.
Valerie Szczepanik noted:
SEC staff across the agency have been engaged for some time in efforts to understand emerging technologies, communicate the agency’s stance on new issues, and facilitate beneficial innovations in the securities industry.
By launching FinHub, we hope to provide a clear path for entrepreneurs, developers, and their advisers to engage with SEC staff, seek input, and test ideas.
By leveraging this dedicated channel of communication for fintech firms, more ICOs should be able to achieve compliance with the regulatory requirements in the U.S. and offer token sales to U.S.-based investors.
Do you agree that this initiative from the SEC will help more ICOs become compliant to U.S. regulations? Let us know in the comments below.
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