27 Jul 2018
The Cypriot financial markets' watchdog CySEC establishes a new innovation hub to better understand emerging FinTech risks. According to the regulatory statement, one of the key areas of interest is Blockchain.
27 July, AtoZ Markets – The main Cypriot financial markets’ regulator, the Cyprus Securities and Exchange Commission (CySEC), has joined the group of regulators that have established their own FinTech research centers. In fact, the CySEC has stated that its new innovation hub will be focused on the development of financial and regulatory technologies.
CySEC’s official statement reads:
“FinTech and RegTech are constantly and quickly evolving. To this end, CySEC has taken the decision to establish the Innovation Hub to foster a better, more effective relationship between entities operating in this area and the way they are regulated. The Innovation Hub will be a place where both supervised and non-supervised entities in innovative or new industries will have ongoing access to CySEC to best understand and implement their regulatory requirements”
The regulatory statement signals that the rapid development of financial technologies prompts the supervisor to take steps to make sure that it can align its processes with new developments in technology.
The hub will allow firms that operate under or outside CySEC’s supervision to access to the regulatory information. Like this, the regulator reportedly aims to improve the understanding of how these firms should comply with the regulatory guidelines.
In addition, businesses will receive regulatory expertise and have access to industry and academic meetings. The Cypriot regulator notes that firms in the hub will be able to influence the regulator’s decision-making process. Demetra Kalogerou, Chair of the CySEC, said:
“The establishment of the Innovation Hub marks an important and exciting step for CySEC’s supervision of new and innovative Fintech companies in Cyprus. In promoting closer ties with these fledgling but fast-growing industries, we aim to best protect investors by fully understanding the risks and benefits these new products bring.”
It appears that CySEC also expresses a particular interest towards Blockchain technology. The regulator has mentioned that the firms in the hub will be able to help CySEC improve its understanding of the peculiarities of new innovative investment products, “using Distributed Ledger Technology (DLT) (e.g. Blockchain).” The watchdog added that this approach can result in a more informed regulatory landscape.
Think we missed something? Let us know in the comments section below.