UK Financial Conduct Authority Rules Out New Rules for Distributed Ledger Technology
12/15/2017The Financial Conduct Authority has published a feedback statement on Distributed Ledger Technology, following the discussion paper it issued in April 2017.
Respondents to the discussion paper provided the FCA with details of various use cases for DLT in the context of payments, asset management, securities trading, financial crime and regulatory reporting. The feedback statement summarizes stakeholder feedback and the FCA's response in relation to: the operational risks arising from permissioned and permissionless networks; the risks and legal and regulatory issues associated with digital currencies and initial coin offerings; digital asset trading and smart contracts; the ability of DLT to improve regulatory reporting and the benefits it could bring in tackling financial crime; and whether DLT is compatible with the requirements of the EU General Data Protection Regulation.
Taking into account the feedback from respondents to the discussion paper, along with its own experiences with DLT applications, such as Blockchain, via its Project Innovate initiative, the FCA sees no need to propose any changes to its Handbook at this time. The FCA remains supportive of technical innovation. It will, however, continue to monitor the DLT environment and will continue to engage and collaborate with industry and other national and international regulatory bodies and global standard-setters. The FCA will review the developments around ICOs more closely to decide whether any regulatory action is required, in particular, following the consumer alert issued in September 2017.
View the feedback statement (FS17/4).TOPIC: FinTech