United Kingdom

Topic: Fintech

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BoE and FCA joint report on machine learning in UK financial services

On 16 October 2019, the Bank of England (BoE) and the FCA published a joint report on machine learning (ML) in UK financial services. The report was created following the responses received in a joint survey of 300 financial institutions. The survey questioned firms on the nature of deployment of ML, the business areas where … Continue Reading

FCA consults on recovery of costs of supervising cryptoassets firms under AML regulations

On 15 October 2019, the FCA published Consultation Paper 19/29: Recovery of costs of supervising cryptoasset businesses under the anti-money laundering regulations – fees proposals (CP19/29). From 10 January 2020, the FCA will become the anti-money laundering and counter terrorist financing (AML/CTF) supervisor for cryptoassets businesses. In CP19/29 the FCA sets out its proposals for … Continue Reading

FSB letter – global resilience in the face of new risks and stablecoins

On 13 October 2019, the Financial Stability Board (FSB) published a letter from Randal Quarles, FSB Chair, to G20 Finance Ministers and Central Bank Governors. The letter highlights three areas of the FSB’s work: ensuring resilience in the face of new risks. The outlook for global growth has started to weaken and become more uncertain. … Continue Reading

FPC agrees principles to ensure payment systems support financial stability

On 9 October 2019, the Bank of England published the financial policy summary and record (FPSR) of the Financial Policy Committee (FPC) meeting on 2 October 2019. During the course of the meeting, among other things, the FPC agreed a set of principles that will guide its assessment of how prudential regulation and supervision should … Continue Reading

BIS publishes working paper on embedded supervision in blockchain finance

On 16 September 2019 the Bank for International Settlements (BIS) published a working paper by its Monetary and Economic Department on Embedded supervision: how to build regulation into blockchain finance. The working paper suggests that asset tokenisation and the use of the underlying distributed ledger technology (DLT) in finance provides new avenues for the supervision … Continue Reading

Commission update on work relating to cryptoassets

On 28 August 2019, the European Commission (the Commission) published an answer given by Valdis Dombrovskis (Vice-President European Commission, Financial Stability, Financial Services and Capital Markets Union) concerning cryptoassets. In its response, the Commission refers to an announcement made in its 2018 Action Plan on FinTech (see previous blog post here) that it is looking … Continue Reading

Joint EBA and ESMA response to the letter of 19 July 2019 on crypto-assets

On 20 August 2019, the European Securities and Markets Authority and the European Banking Authority (together the European Supervisory Authorities) published a letter in response to an earlier letter from Valdis Dombrovskis (Vice-President European Commission, Financial Stability, Financial Services and Capital Markets Union) concerning crypto-assets, including so-called ‘stablecoins’. The letter outlines some of the European … Continue Reading

ICO joins other data protection authorities in issuing statement on Facebook’s cryptocurrency Libra project

On 18 June 2019, Facebook announced plans to launch a new blockchain enabled cryptocurrency called Libra. In early August 2019, the UK’s Information Commissioner’s Office (the ICO) joined other data protection authorities from around the world (from Europe, the Americas, Africa and Australasia) in publishing a statement to Facebook and the 28 other companies behind … Continue Reading

FMLC paper on legal uncertainties arising from ICOs

On 31 July 2019, the Financial Markets Law Committee (FMLC) published a paper identifying issues of legal uncertainty arising from initial coin offerings (ICOs). The FMLC examines the legality of ICOs in different jurisdictions emphasising the lack of international harmonisation and varied approaches to regulation and considers the exploratory work required to provide certainty for … Continue Reading

FCA publishes final guidance on cryptoassets regulation

On 31 July 2019, the FCA published Policy Statement 19/22: Guidance on cryptoassets – feedback and final guidance to CP19/3 (PS19/22). In PS19/22 the FCA responds to the feedback it received to Consultation Paper 19/3: Guidance on cryptoassets (CP19/3) (our blog is here) and sets out the final guidance. The purpose of CP19/3 was to … Continue Reading

ECB letter regarding stablecoin initiatives

On 26 July 2019, the European Central Bank (ECB) published a letter from its president, Mario Draghi, to Markus Ferber MEP. In the letter Mr Draghi discusses how the European System of Central Banks (ESCB) is closely monitoring innovation in the financial sector, including stablecoin projects such as Facebook’s ‘Libra’. The ESCB also contributes to … Continue Reading

EBA report on approaches relating to FinTech activities

On 18 July 2019, the European Banking Authority (EBA) published a report illustrating the findings of an analysis on issues relating to access to the market for FinTech firms. The analysis focused on the monitoring of national developments on the regulatory perimeter; the national regulatory status of FinTech firms; and the approaches followed by Member … Continue Reading

ESMA report on the licensing of FinTech business models

On 12 July 2019, the European Securities and Markets Authority (ESMA) published a report on the status of licencing regimes of FinTech firms across the EU. The report is based on two surveys conducted by ESMA since January 2018, which gathered evidence from Member State national competent authorities (NCAs) on the licencing regimes of FinTech … Continue Reading

EBA reveals the four key trends that will affect payment institutions’ and e-money institutions’ business models

The European Banking Association (EBA) has published a report titled “The Impact of Fintech on Payment Institutions’ and E-Money Institutions’ business models” (the Report). The Report acknowledges the significant changes that have taken place in the broader Fintech landscape over the last few years, focussing on the Payment Institution (PI) and E-Money Institution (EMI) space. … Continue Reading

ECB assesses impact of FinTech on payment institutions’ and e-money institutions’ business models

On 8 July 2019, the European Banking Authority (EBA) published a thematic report on the impact of FinTech on payment institutions’ (PIs) and electronic money institutions’ (EMIs) business models. Key points in the report include: the payments landscape in the EU is undergoing significant transformation due to the introduction of the revised Payment Services Directive … Continue Reading

FCA proposes ban on sale of crypto-derivatives to retail consumers

On 3 July 2019, the FCA issued Consultation Paper 19/22: Restricting the sale to retail clients of investment products that reference cryptoassets (CP19/22). In CP19/22 the FCA are proposing to ban the sale, marketing and distribution to retail clients of derivatives and exchange traded notes (ETNs) referencing unregulated transferable cryptoassets. These measures will be applied … Continue Reading

FCA speech on regulating financial innovation

On 2 July 2019, the FCA published a speech by Christopher Woolard (Executive Director of Strategy and Competition, FCA). The speech, Regulating financial innovation – going behind the scenes, covers ‘stablecoins’ and ‘non-stablecoins’. Mr Woolard explains that market participants use ‘stablecoin’ as a broad term, which encompasses a variety of different types of cryptoassets. A … Continue Reading

BIS to set up innovation hub for central banks

On 30 June 2019, the Bank for International Settlements (BIS) approved the establishment of an innovation hub to foster international collaboration on innovative financial technology within the central banking community. The role of the hub will be to identify and develop in-depth insights into critical trends in technology affecting central banking: develop public goods in … Continue Reading

IOSCO urges authorities to use existing standards to address cyber risk

On 18 June 2019, the Cyber Task Force of the International Organization of Securities Commissions (IOSCO) published a final report that provides an overview of how its members are using three prominent and internationally recognised cyber frameworks (defined in the report as the ‘Core Standards’): National Institute of Standards and Technology Cybersecurity Framework; CPMI-IOSCO Guidance … Continue Reading

BoE, FCA and MAS announce collaboration on cybersecurity

On 13 June 2019, the Bank of England (BoE) published a press release alongside the FCA and the Monetary Authority of Singapore (MAS) regarding collaboration in the field of cyber security. Specifically, the MAS, the BoE and the FCA have announced that they will be working together to strengthen cyber security in their financial sectors. … Continue Reading

FSB report on decentralised financial technologies

On 6 June 2019, the Financial Stability Board (FSB) published a report considering the implications of decentralised financial technologies. The report considers the financial stability, regulatory and governance implications of the use of decentralised financial technologies such as those involving distributed ledgers and online peer-to-peer, or user-matching, platforms. The report focuses on technologies that may … Continue Reading

IOSCO update on 2019 work programme

On 30 May 2019, the International Organisation of Securities Commissions (IOSCO)  issued a press release following its meeting this month in which priority issues facing securities market regulators and supervisors were discussed. The priority issues include: crypto-assets. IOSCO will be publishing a consultation report on crypto-asset trading platforms, in response to a G20 request. IOSCO … Continue Reading