HomeBusinessCrypto exchange federation promotes regulation and integration with traditional finance.

Crypto exchange federation promotes regulation and integration with traditional finance.

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The World Federation of Exchanges (WFE) has released a paper discussing the potential of crypto-asset trading platforms (CTPs) to contribute to the “real” economy and society. In the paper, the WFE suggests that CTPs should embrace regulation to enhance their market appeal. One of the key principles highlighted by the WFE is the need for CTPs to segregate functions to prevent trading against their customers, a concern frequently raised by Gary Gensler, the chairman of the US Securities and Exchange Commission. The WFE emphasizes that until CTPs meet these standards, they should not refer to themselves as exchanges.

The WFE’s stance on regulating CTPs reflects its belief in the importance of responsible market conduct and upholding investor protection. The organization suggests six key principles for regulators to consider when addressing CTP regulation. By adhering to these principles, CTPs can instill confidence among investors and stakeholders, ultimately boosting the appeal of their markets. The WFE’s recommendations aim to create a more transparent and secure environment for crypto trading, which could lead to increased adoption and integration of crypto assets with traditional finance (TradFi).

Overall, the WFE recognizes the potential of CTPs to foster economic growth and societal benefits. However, it emphasizes the importance of adhering to regulatory standards to ensure the integrity and fairness of these platforms. By doing so, CTPs can position themselves as trusted marketplaces, giving investors the confidence they need to participate in the crypto market and facilitating the integration of crypto assets with the broader financial ecosystem.

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