Global Digital Finance (GDF) has partnered with a range of well-known platforms in the crypto industry to create, and encourage the adoption of, a clear set of global regulations and guidelines for crypto assets.
Cryptocurrencies aim to be global mediums of exchange. For example, if you’re based in China, you need to be able to quickly, safely and cheaply send virtual funds to someone in Switzerland. However, the regulations regarding cryptocurrencies in these countries couldn’t be more different.
This could be why more and more companies are calling for global regulations and rules when it comes to definitions, processes, and policies in the industry. Live Bitcoin News recently reported that the Financial Action Task Force (FATF) is working towards creating these standardized regulations, which are also what Circle’s Jeremy Allaire believes there is a need for.
Global Regulations and Code of Conduct
In fact, according to a press release, Circle is one of the companies involved Global Digital Finance’s (GDF) latest initiative. The latter aims to encourage and foster digital innovation and advancements in FinTech. One of the ways that they hope to do this is by creating an industry Code of Conduct, which will be known as the GDF Code, as well as a Taxonomy process to properly classify and define crypto assets.
The goal is to get crypto industry platforms to follow these global regulations, which will show their customers and regulators that they are adhering to a certain set of standards. GDF’s co-founder, Simon Taylor, explained the importance of this:
Customers want to know the firms they are doing business with are ethical and not breaking (international) laws. this extends from cryptocurrencies like Bitcoin, wallet providers and exchanges, to firms offering investment products in tokens, securities, and funds.
This framework was made possible through the assistance and feedback of more than 100 industry stakeholders and companies. In addition, the GDF also discussed its framework with global regulators and other agencies that focus on developing and setting standards. Another co-founder of the GDF, Jeff Bandman, added that “regulators have been hugely supportive of the development of GDF and the Code” and that “digital assets are global and no one jurisdiction has authority over the entire sector”.
Growing the Team and Encouraging More to Join
The GDF initiative has also attracted interest from major players including Circle, Coinbase, and ConsenSys. Representatives from these platforms and others have joined the initiative as its Founding Members. Allaire chatted about Circle’s involvement:
Building public trust is essential to Circle and to democratizing finance using crypto assets and blockchain technology. We are proud to be joining an organization that is helping ensure the industry upholds the high standards the public deserves.
Regulations are, of course, not new to the crypto industry. However, since Bitcoin’s price peak last December, authorities have started to keep a closer eye on it. Regulators are concerned about fraud and dodgy ICOs, while some platforms are still at a loss at how to navigate the murky waters of regulations. Zeeshan Feroz, who is Coinbase’s UK CEO, touched on this:
Individuals need to be able to distinguish crypto businesses that are trying to facilitate the safe transfer of digital assets, with a compliance-first approach, from those that may be pushing the boundaries of what may be considered legal in other areas. By adhering to the Code of Conduct, firms are making it clear to their customers that they take safety and security seriously.
These firms will be able to register with the GDF from the first quarter of next year, and in doing so, pledge to adhere to the Code of Conduct. Regulators may also be interested to know that these standards will continue to evolve with future additions including guidelines related to money laundering and terror financing.
Do you think crypto platforms will register with the GDF and follow these global rules? Do you think that this is the best way to develop regulations for the industry? Let us know in the comments below!
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