Inside FinTech blog

On 2 June 2022, there was published in the Official Journal of the EU, Regulation 2022/858 of 30 May 2022 on a pilot regime for market infrastructures based on distributed ledger technology (DLT), and amending MiFIR, CSDR and MiFID II. Most of the provisions of the Regulation apply from 23 March 2023.

On 27 May 2022, the Basel Committee met and approved a finalised set of principles for the effective management and supervision of climate-related financial risks. The Committee also progressed work on specifying crypto-asset prudential treatment and issuing a second consultation paper. Additionally, the Committee finalised the review of the treatment of cross-border exposures within the European Banking Union (EBU) on the G-SIB methodology.

On 31 May 2022, HM Treasury published an open consultation seeking views on a regime to address the failure of a systemic digital settlement asset (DSA) firm.

The latest post from our firm’s banking and commercial disputes blog, Inside Disputes, discusses causes of action that may arise from both algorithmic and traditional asset-backed stablecoins, and highlights the key litigation challenges in respect of blockchain technology.

On 25 May 2022, the Financial Services Regulatory Initiatives Forum (Forum) published an updated version of the Regulatory Initiative Grid which sets out the regulatory pipeline so that financial services firms and other stakeholders can understand, and plan, for the timing of the initiatives that may have a significant operational impact on them. The Forum comprises of the Bank of England, FCA, PRA, Payment Systems Regulator, the Competition and Markets Authority, the Information Commissioner’s Office, the Pensions Regulator and the Financial Reporting Council. HM Treasury is an observer member.

On 25 May 2022, Duncan Mackinnon (Executive Director for Supervisory Risk Specialists) gave a speech at the City and Financial 9th Annual Operational Resilience for Financial Institutions Summit. In his speech Mr Mackinnon discusses where the PRA expects firms to focus on as they work towards building operational resilience by March 2025. By this time, firms will need to ensure they are resilient to disruption of their important business services, which if disrupted, could pose a risk to their safety and soundness or in certain cases to the financial stability of the UK.

Blockchain transactions are often said to be anonymous or at least pseudonymous—but are they really? At least for some users, part of the appeal of using cryptocurrency is the perceived anonymity it seemingly offers. But increasingly, judicial decisions and governmental enforcement activity show that this perception is mistaken.

Global law firm Norton Rose Fulbright advised the Global Blockchain Business Council (GBBC) on its merger with Global Digital Finance Limited (GDF), which sees the establishment of the world's largest members' association for the blockchain technology and digital assets sector.

Any investigation—and particularly a cross-border investigation—throws up a huge number of data issues. Authorities are increasingly seeking data held overseas or on personal devices, and individuals are increasingly aware of—and enforcing—their data privacy rights. It is crucial to understand how to best manage the risks involved while moving an investigation forward.

Over USD 500 billion dollars was wiped off the value of all cryptocurrencies during the first 12 days of May, following the collapse of the Luna cryptocurrency and its sister stablecoin, TerraUSD (UST).