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Topic: Fintech

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FSB report assesses FinTech developments and potential financial stability implications

On 14 February 2019, the Financial Stability Board (FSB) published a report on FinTech and market structure in financial services. The FSB defines FinTech as technology-enabled innovation in financial services that could result in new business models, applications, processes or products with an associated material effect on the provision of financial services. The report considers … Continue Reading

ESMA publishes advice to EU institutions on ICOs and crypto-assets

On 9 January 2019, the European Securities and Markets Authority (ESMA) published its advice to the EU institutions (the European Commission, the Council of the EU and the European Parliament) on initial coin offerings (ICOs) and crypto-assets. Prior to the publication of the advice ESMA has been working with Member State national competent authorities (NCAs) … Continue Reading

EBA report on crypto-assets

On 9 January 2019, the European Banking Authority (EBA) published a report containing the results of its assessment of the applicability and suitability of EU law to crypto-assets. The report states that based on the analysis conducted by the EBA, crypto-assets typically fall outside the scope of EU financial services legislation and specific services relating … Continue Reading

ESAs report on regulatory sandboxes and innovation hubs

On 7 January 2019, the Joint Committee of European Supervisory Authorities (ESAs) published a report on FinTech, concerning regulatory sandboxes and innovation hubs (together, innovation facilitators). In the report, the ESAs analyse the innovation facilitators established to date within the EU. The ESAs also set out ‘best practices’ regarding the design and operation of innovation … Continue Reading

Commission action plan on AI

On 17 December 2018, the European Commission issued a press release concerning a coordinated plan prepared with Member States to foster the development and use of artificial intelligence (AI) in Europe. The plan proposes joint actions for closer and more efficient cooperation between Member States, Norway, Switzerland and the Commission in four key areas: increasing … Continue Reading

Cyber-resilience: range of practices

On 4 December 2018, the Basel Committee on Banking Supervision (Basel Committee) published a report which identifies, describes and compares the range of observed bank, regulatory and supervisory cyber-resilience practices across jurisdictions. For the purpose of the report, the Basel Committee uses the Financial Stability Board’s Cyber Lexicon definition of cyber-resilience, which defines it as … Continue Reading

ECB cyber resilience oversight expectations for FMIs

On 3 December 2018, the European Central Bank (ECB) published its cyber resilience oversight expectations for financial market infrastructures (FMIs) (the Expectations). In June 2016, the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) published Guidance on cyber resilience for financial market infrastructures (Guidance). The Expectations provides FMIs … Continue Reading

ECB speech on cryptos, cyber and CCPs

The ECB has published a speech by Benoît Coeuré, the Chair of the Committee on Payments and Market Infrastructures (CPMI). The speech is entitled The new frontier of payments and market infrastructure: on cryptos, cyber and CCPs. The slides that accompanied the speech have also been published. Key messages in the speech include: the G20 … Continue Reading

Valdis Dombrovskis statement on regulating virtual currencies

On 13 November 2018, European Commission Vice-President Valdis Dombrovskis issued a statement at the European Parliament Plenary on regulating virtual currencies and Initial Coin Offerings (ICOs). In the statement, Mr Dombrovskis posts two questions for financial regulators to consider: Whether crypto-assets are financial instruments, and are therefore covered by financial regulation? Whether that regulation is … Continue Reading

FSB Cyber Lexicon published

On 12 November 2018, the Financial Stability Board (FSB) published the first edition of a Cyber Lexicon, which comprises a set of approximately 50 core terms related to cyber security and cyber resilience in the financial sector. The lexicon is not intended for use in the legal interpretation of any international arrangement or agreement or … Continue Reading

ESMA stakeholder group advises on managing risks of ICOs and crypto-assets

On 19 October 2018, the European Securities and Markets Authority (ESMA) published its Securities and Markets Stakeholder Group (the Stakeholders) own initiative report on initial coin offerings (ICOs) and crypto-assets. The report has been produced by the Stakeholders to advise ESMA on steps it can take to manage the risks of ICOs and crypto-assets on … Continue Reading

FSB sets out potential financial stability implications from crypto-assets

On 8 January 2018, the combined market capitalisation of crypto-assets peaked at an estimated $830 billion, of which approximately 35% was attributable to bitcoin. This dropped to just over $210 billion as of 4 October 2018. The rapid price increase in 2017 elicited interest from retail investors and attracted the attention of regulated financial institutions … Continue Reading

ESA Joint Committee report on automation in financial advice

On 5 September 2018, the Joint Committee of the European Supervisory Authorities (comprised of ESMA, EBA and EOPA) published a report on the results of their monitoring exercise on ‘automation in financial advice’ (the Report). The Report follows the Joint Committee’s 2015 discussion paper on automation in financial advice, and their 2016 report on the … Continue Reading

ECB publishes Services Procurement Guidelines for TIBER-EU framework

In its role as a banking supervisor, the European Central Bank (ECB) asks the largest euro area banks to report significant cyber incidents as soon as they detect them. This helps the ECB identify and monitor trends in cyberattacks, which puts it in a position to be able to react more swiftly to a potential … Continue Reading

BaFin publishes study on Big Data meets AI

On 16 July 2018, the BaFin published a speculative study addressing the technological developments of big data (BD) analytics and artificial intelligence (AI). As BaFin President Felix Hufeld mentioned in the study’s foreword the financial sector is undergoing profound technology change with digitalisation reaching new heights. The study describes the BD / AI interaction and … Continue Reading

BaFin publishes report and opens consultation on regulatory future of FinTech

On 16 July, the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht or BaFin) published its new report “Big data meets artificial intelligence – Challenges and implications for the supervision and regulation of financial services”. The report, which was created in conjunction with Partnerschaft Deutschland, the Fraunhofer Institute and The Boston Consulting Group, aims to … Continue Reading

FSB report on crypto-assets

On 16 July 2018, the Financial Stability Board (FSB) has published a report describing international work on crypto-assets. The report follows a letter that FSB Chair Mark Carney sent to G20 Finance Ministers and Central Bank Governors in March noting that crypto-assets raise a host of issues around consumer and investor protection, as well as … Continue Reading

Study on competition issues in the area of financial technology

On 9 July 2018, the European Parliament’s Committee on Economic and Monetary affairs published a study, Competition issues in the Area of Financial Technology (FinTech). The study focuses on analysing potential anti-competitive factors and their impact both in the FinTech ecosystem and in concrete services. In lieu of any consensus, the study proposes FinTech services … Continue Reading

EBA assesses risks and opportunities from FinTech and its impact on incumbent business models

On 3 July 2018, the European Banking Authority (EBA) published the first products of its FinTech Roadmap: a thematic report on the impact of FinTech on incumbent credit institutions’ business models. The report has two aims: (i) to provide an overview of the current FinTech landscape and the observed changes in the incumbent institutions’’ behaviour … Continue Reading

FSB cyber lexicon consultative document

On 2 July 2018, the Financial Stability Board (FSB) published a consultative document regarding a cyber lexicon which comprises a set of 50 core terms related to cyber security and cyber resilience in the financial sector. Whilst the lexicon is not intended for use in the legal interpretation of any international arrangement or agreement or … Continue Reading

Global ICO and cryptocurrency regulatory roundup

Recently there have been a number of blog postings on initial coin offerings (ICOs) and cryptocurrency, and here is a round-up of them in case you missed them: Global IOSCO Board communication on concerns about ICOs (19 January 2018) Australia Listed funds holding crypto-assets: ASX’s position (25 February 2018) ASIC updates INFO 225: Corporate regulator … Continue Reading

ECB publishes European framework for testing financial sector resilience to cyber attacks

On 2 May 2018, the European Central Bank (ECB) published the European Framework for Threat Intelligence-based Ethical Red Teaming (TIBER-EU), which is the first Europe-wide framework for controlled and bespoke tests against cyber-attacks in the financial markets. TIBER-EU based tests simulate a cyber-attack on an entity’s critical functions and underlying systems, such as its people, … Continue Reading

ECB consults on cyber resilience oversight expectations

On 10 April 2018, the European Central Bank (ECB) published a consultation on draft guidance concerning cyber resilience expectations for financial market infrastructures (FMIs).  The ECB sees cyber resilience as an important aspect of FMIs’ operational resilience and is also a factor affecting the overall resilience of the financial system and the broader economy. The … Continue Reading

GFMA cyber security penetration testing framework

On 3 April 2018, the Global Financial Markets Association (GFMA) published A Framework for the Regulatory Use of Penetration Testing in the Financial Services Industry. The framework provides a guide for the development of a cyber security penetration testing framework comprising of a four phased testing lifecycle: Threat intelligence phase – a firm’s internal intelligence … Continue Reading
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