by Cindy Huynh
A new industry body called Global Digital Finance (GDF) will establish a global code of conduct for crypto assets and tokens. The not-for-profit’s goal is to protect market participants from misuse and misrepresentation of cryptocurrencies and blockchain technology.
Wrangling in the Wild West of Crypto
According to the press release, crypto assets are a growing industry with an estimated market size of $500 billion. However, without the necessary rules and standards, there is the potential for risk and misuse of crypto assets.
The establishment of the GDF is therefore of extreme importance, especially when it comes to the existence and longevity of the crypto asset industry.
Since cryptocurrencies are global assets, the universal code of conduct will require leading international experts and regulators from the blockchain and cryptocurrency sector to share their knowledge concerning the opportunities, risks, and practices to transform the financial services sector, society and the global economy at large.
Adding a Professional Code of Conduct
The not-for-profit board is committed to creating a transparent, inclusive process of furthering policies and regulations on a global scale.
To move forward, GDF is currently working with industry bodies, regulators and authorities from the US and Europe. They’re also now in conversation with The Organisation for Economic Co-operation and Development (OECD) to promote and coordinate new policies from a variety of governments.
“Cryptoasset applications like ICOs hold clear potential and are global in reach, but are subject to a wide range of regulator treatments across jurisdictions, said Greg Medcraft, Director of the Directorate for Financial and Enterprise Affairs at OECD.
“This demonstrates the need for international policy coordination, and the first step is to establish a common understanding. We welcome GDF’s initiative to develop a taxonomy and a Code of Conduct, and the OECD looks forward to collaborating with industry on these priorities.”
The industry will begin developing a global code of conduct starting with the Initial Coin Offering (ICO) market.
Although the ICO industry is as large as $6 billion, due to the influx of scams and frauds in this industry, it is has become a recent subject of focus for many policymakers and regulators.
Urgent Challenges in the Cryptocurrency and Blockchain Industry
While there are a lot of matters to be discussed, the urgent challenges that the BDF must tackle first include: Understanding how tokens work, monitoring the market’s financial stability and integrity in regards, offering better protection to vulnerable investors, and adopting a standardized approach in Anti Money Laundering and Counter-Terrorism Financing.
The BDF recently gained the support of two industry veterans to help solve these pressing matters. They’ve enlisted Lawrence Wintermeyer, the previous CEO of Innovate Finance, and Jeff Bandman, a former US Commodity Futures Trading Commission (CFTC).
GDF hopes to achieve a draft of the Code of Conduct by Q2 2018, so they can gain constructive feedback from the industry at large.
Their goal is to adopt the global Code of Conduct by the second half of the year. The document will also have a taxonomy attachment that will cement a shared understanding of relevant terms which will form the foundation of the Code of Conduct.