If the US SEC classifies cryptocurrencies as securities, OTC Marks will be well-positioned to provide liquidity to these assets in the future.
During its earnings call earlier this week, OTC Markets announced that it has secured FINRA approval to provide services for digital assets treated as securities. This is a major development as it provides a regulated market for large investors to trade in crypto securities.
In its quarterly report, OTC Markets noted that an update to its Membership Agreement to facilitate transactions in digital securities will allow OTC Link customers to quote and trade digital asset securities using the OTC Link ATS. But it is too early to speculate whether such activity will have a material impact on OTC Link’s financial results.
Like an exchange, an ATS operates as a regulated trading platform. There are dozens of ATS platforms, however, most operate in the private securities market. OTC Markets has a trading platform for a range of public securities including small banks, and global firms as well as grayscale funds that hold assets Bitcoin And Ethereum, Speaking on the development, OTC Markets President and CEO R. Cromwell Coulson said:
“We recently received FINRA approval to allow broker-dealers to trade digital asset securities on the OTC Link ATS. This approval furthers our mission of operating regulated marketplaces for broker-dealers and issuers of securities. While the regulatory framework and infrastructure development will take some time, we believe our markets are well positioned to be part of the new trading, data and disclosure solution for these securities.”
crypto and regulation
OTC Markets is adopting a regulatory-driven approach as it plans to offer its clients to trade digital securities. Cass Sanford, deputy general manager of OTC Markets, said proper disclosure is essential to investor protection.
For a long time, seconds Chief Gary Gensler has been insisting that all cryptocurrencies are securities. Thus, if this turns out to be true, OTC markets would be well positioned to provide liquidity to these assets in the future. Sanford said that should the SEC classify digital assets as securities, they would act as OTC equity securities. She also said that currently a lot of the instruments look like OTC securities. sanford Explained,
“The world’s largest digital asset investment vehicle trades in our markets. These securitized products allow investors to gain exposure to digital assets through broker-dealers and investment advisors operating within a robust framework of state and federal securities laws.” We also recently received FINRA approval to allow broker-dealers to trade digital asset securities on our Alternative Trading System (ATS).
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Bhushan is passionate about Fintech and has a good grasp of understanding the financial markets. His interest in economics and finance drew his attention to the newly emerging blockchain technology and cryptocurrency markets. He is in the process of continuous learning and keeps motivating himself by sharing his acquired knowledge. In his spare time he reads thriller fiction novels and occasionally explores his culinary skills.
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