In the intricate world of financial regulations, SEC Rule 15c3-3, often referred to as the "Customer Protection Rule," plays a crucial role in safeguarding customer assets held by broker-dealers. This rule, established by the Securities and Exchange Commission (SEC), ensures that customer funds and securities are adequately protected, preventing broker-dealers from using these assets for […]

Can dressing up a digital trading platform like a video game lure retail investors into excessive or ill-advised trades with rewards as fleeting as a puff of virtual confetti or a simulated slot machine spitting out cartoon coins? That’s just one of the questions the Securities and Exchange Commission is trying to answer by inviting […]

Last month, German banks completed the first over-the-counter (OTC) interest rate derivative trade using a digital smart contract. DZ Bank and BayernLB were the trading counterparties, while Deutsche Börse’s Eurex Clearing was the central counterparty (CCP) for exposures from the non-settled OTC transaction. 

On August 26, 2020, the U.S. Securities and Exchange Commission (“SEC”) approved amendments to the “accredited investor” definition1, thereby increasing the number of persons that can participate in private offerings of securities2.  Previously, individuals that wanted to participate in private offerings generally had to be high earning or high net-worth individuals to qualify as “accredited […]

Just in time for the holidays, the U.S. Securities and Exchange Commission (“SEC”) gifted investors and other financial market participants with a notice of proposed changes to the “Accredited Investor” definition to expand access to private capital markets. The proposed rule would add new categories of persons that qualify as accredited investors based on professional […]

The U.S. Securities and Exchange Commission (“SEC”) adopted “Regulation Best Interest” (“Reg BI”) on June 5, 2019, requiring broker-dealers to act in the best interest of their retail customers when recommending securities or a particular investment strategy. Additionally, the SEC adopted a new Exchange Act Rule 17a-14, 17 CFR § 240.17a-14, that requires broker-dealers to […]

On April 25, 2019, the New York Office of the Attorney General (“OAG”) announced that it obtained a court order against the operators of Bitfinex[note]Here, “Bitfinex” refers to the online platform and is operators, iFinex Inc., BFXNA Inc., and BFXWW Inc.[/note] demanding the online digital asset exchange turn over a plethora of important documents related to […]

On April 3, 2019, the Securities and Exchange Commission’s (SEC’s) Strategic Hub for Innovation and Financial Technology, a.k.a. the SEC FinHub, released its “Framework for ‘Investment Contract’ Analysis of Digital Assets,” (the “Framework”)[note]The Framework “is not a rule, regulation, or statement of the Commission, and the Commission has neither approved nor disapproved its content. . […]

Effective April 1, 2019, every National Futures Association (“NFA”) member commodity pool operator (“CPO”) that handles customer funds must implement an internal controls system (“ICS”) that “is designed to deter fraudulent activity by employees, management, and third parties” to ensure that each Member CPO properly safeguards customer funds, provides accurate and timely financial reports, and […]

On January 22, 2019, the Financial Industry Regulatory Authority (“FINRA”) published its 2019 Risk Monitoring and Examination Priorities Letter (“2019 Priorities Letter”). FINRA annually publishes its Priorities Letter to highlight the areas on which it intends to focus for the upcoming year. While the majority of 2019’s focus areas are the same as last year’s […]