The below article reminded me how regulators are actively looking at innovative technology across the globe. The UK's Financial Conduct Authority (FCA) is one of the leading regulators in this respect, having started Project Innovate sandbox four years ago (discover our report on the experiences of start-ups in the sandbox). We are now seeing collaboration at an international level, with many agreements now in place, including between the FCA and the CFTC and the FCA and the HKMA.
These domestic and international initiatives certainly foster innovation by:
- guiding new firms through the relevant regulatory frameworks.
- providing regulatory 'sandboxes' for innovative new products to be tested in the market, with real consumers.
- referring firms across national regulators to accelerate international understanding of new technology.
- providing an mechanism for sharing knowledge and experiences between regulators.
While regulators need to keep their primary objectives in mind, promoting market stability and protecting customers does not preclude novel developments and may well be enhanced by innovative new products.
The mission of LabCFTC is to facilitate market-enhancing innovation, inform policy, and ensure we have the technological and regulatory tools and understanding to keep pace with changes to our markets.