As a financial content services agency, we closely watch moves in our sector. We follow updates from the top regulators, key market announcements and the trends happening in forex, regtech, wealthtech and fintech. Every month we round up the top regulatory announcements to ensure we remain compliant, and to help our clients stay informed. Here’s our financial regulations roundup for January 2025.
Paul Atkins Nominated To Lead SEC
American regulatory agencies are bracing for more changes as the Donald Trump administration starts. One of the big news will be the appointment of Paul Atkins to be the head of the Securities and Exchange Commission (SEC). Last month we mentioned this as a possibility and it’s happened.
Atkins is a veteran regulator who served as a staffer at the agency in the 1990s and a commissioner between 2002 and 2008. After that, he created a consulting firm that advised companies on regulations. Atkins is expected to be a different financial regulations leader, especially in the crypto industry. In the past few years, he has been a key supporter of the sector, and even consulted some of the top players.
Therefore, analysts expect that Atkins will be different from Gary Gensler, who has focused on lawsuits. He initiated lawsuits against companies like Ripple Labs, Coinbase, Uniswap, Immutable Labs, and Binance.
CySEC Outlines Transitional Rules For Crypto
The Cyprus Securities and Exchange Commission provided fresh financial regulations guidance for companies offering crypto services in the country. The agency specifically addressed the transitional provisions of the Markets in Crypto-Assets Regulation (MiCA).
According to CySEC, firms that provide services in line with national regulation may continue their operations during the transitional period, which runs through July 2026. The companies, however, must submit documents demonstrating their compliance with national financial regulations rules by January 10.
Meanwhile, the agency broke its six-month consultation silence by proposing new rules that would expand the use of the English language in prospectuses. The new changes aim to promote the competitiveness of Cyprus companies since English is one of the most popular languages globally.
ESMA Publishes Reports on MiCA Transition
The European Securities and Markets Authority (ESMA) continued its preparations for the transition to MiCA. It did that by publishing reports with technical guidelines ahead of the implementation. The guidelines published included issues like technical standards on market abuse, reverse solicitation, suitability, crypto-asset transfer services, and qualifications of crypto-assets as financial instruments.
European regulators passed the MiCA rules in 2023 in a goal to help the region become a key and safe participant in the crypto industry. Some of these regulations were focused on stablecoins, transparency, disclosure, and supervision of transactions. The goal of these regulations is to support market integrity and financial stability.
EU’s policies will likely differ from those of the United States, where Donald Trump is focusing on deregulating the industry. As such, there is a likelihood that the US will continue being a market leader in the crypto industry.
FCA Head Warns On Deregulation
Ashley Alder, the head of UK’s Financial Conduct Authority (FCA), warned that the UK should avoid a race to the bottom in regulations as Trump enters the White House. Trump has pledged to deliver substantial deregulation in the next four years. Alder believes there are dangers to following the US on that, as more deregulations would expose the block to substantial risks.
The UK is also working on some deregulation of its own as it works to become a more competitive country after Brexit. Chancellor Rachel Reeves has said that the rules implemented post-Brexit went too far and prevented risk-taking. She wants the FCA to make major reforms in a bid to make the UK more competitive.
Trump To Shrink, Consolidate, And Eliminate Banking Regulators
The biggest regulatory news in December was that Trump was considering making major changes in the financial regulation sector. The incoming administration is consulting on how to shrink the banking regulatory state.
One proposal is to move functions of the Office of the Comptroller of Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) into the Treasury Department. Some of these agencies have been blamed for over-regulating the industry.
For example, the FDIC is battling asset managers like Blackrock regarding bank ownership. The agency has given Blackrock until January 10 to accept proposed new rules whenever it owns more than 10% of US banks. Blackrock said:
The FDIC is applying new restrictions to certain firms as a fait accompli before reviewing comments on the proposal. The approach lacked transparency and applies inconsistent standards across firms without a clear rationale.
Whether these proposals will become law is unclear since they need congressional approval. While Republicans control the House and the Senate, their margins are thin, and they would need Democrats to implement major changes.
Trump Considers Brian Quintenz To Lead CFTC
Meanwhile, Donald Trump is considering appointing Brian Quintenz as the next head of the Commodity Futures Trading Commission (CFTC). Quintenz is a former commissioner at the CFTC with extensive experience in the crypto industry. He currently serves as the head of policy at a16z, one of the biggest players in venture capital. His appointment, together with that of Paul Atkins at the SEC, would solidify Trump’s administration as the most crypto-friendly in recent years. In addition to Quintenz, Trump is also considering Summer Mersinger and Caroline Pham to lead the agency.
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