Templum, a technology innovator that provides regulated market infrastructure for the digital asset sector has recently requested SEC to define clear regulations for the digital assets industry. Templum Markets is one of the only Alternative Trading Systems approved to conduct secondary trading of digital assets.
The firm asked SEC to provide much needed guidance related to post-trade activities in the digital asset space. Templum, further added that they believe fintech and blockchain technology has huge potential and the role of regulations will play a key role how the revolutionary technology develops in a sustainable manner.
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The firm encouraged SEC to examine regulations in the light of blockchain technology by allowing issuers or trading platforms to use the tech in lieu of banks as custodians. With proper set of regulations SEC could significantly streamline securities trading and reduce transaction costs, producing savings for investors.
Recommendations from Templum
Templum recommended the following points to SEC in order to take advantage of this high potential industry and modernize regulations related to clearance and settlement:
- The SEC should clearly define when a blockchain technology platform must register as a clearing corporation and define how blockchain technology may be used in such firms.
- SEC should provide clear guidance to the industry as to when a blockchain technology must register as a transfer agent and provide guidance to issuers of digital assets as to when they must use a transfer agent.
- SEC should modernize the Custody Rule and the Customer Protection Rule to take into account and encourage the use of blockchain technology’s ability to track securities transactions.
The young security token industry is nourishing lots of potential but the lack of clear set of regulations is causing uncertainty in the industry. The letter, signed by senior Templum executives Vincent Molinari and Christopher Pallotta, highlighted the increased need for current legislation in order to foster the world’s technological capabilities to provide for a safe and effective future of investing.
What is your opinion about the importance of regulations for the growth of security token industry? Share your opinions in comments.