FINRA Issued A Regulatory Notice On Digital Assets
Last week the Financial Industry Regulatory Authority (FINRA) issued a Regulatory Notice on digital assets. It is a not-for-profit organization authorized by Congress. Its website describes it as not part of the U.S. government but is tasked with protecting America’s investors by making sure the broker-dealer industry operates fairly and honestly.
With few exceptions, the Authority explains that in addition to registering with the U.S. Securities and Exchange Commission (SEC). Every firm and broker that sells securities to the public in the United States must be licensed and registered by the Financial Industry Regulatory Authority. Individual registered representatives must also register with them.
According to its website, It had 629,112 registered representatives and 3,712 member firms in April.
In the 4-page notice, the Authority emphasized that it will be monitoring developments in the digital asset marketplace and is making strong efforts to ascertain the extent of FINRA member involvement related to digital assets.
On the behalf of the organization, it was said:
“FINRA is issuing this notice to encourage each firm to promptly notify FINRA if it, or its associated persons or affiliates, currently engages, or intends to engage, in any activities related to digital assets, such as cryptocurrencies and other virtual coins and tokens.”
According to an Annual Regulatory and Examination Priorities Letter, the Letter highlights issues of importance to the organization’s regulatory programs.
This letter was published earlier this year by FINRA’S CEO Robert Cook.
He mentioned that cryptocurrencies and initial coin offerings (ICOs) have received significant media, public and regulatory attention in the past year. The Letter highlights issues of importance to the organization’s regulatory programs.
CEO Robert Cook said,
“FINRA will closely monitor developments in this area, including the role firms and registered representatives may play in effecting transactions in such assets and ICOs. Where such assets are securities or where an ICO involves the offer and sale of securities, FINRA may review the mechanisms…firms have put in place to ensure compliance with relevant federal securities laws and regulations and FINRA rules.”
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