Climate and crypto fraught with challenges for regulators 

A decade or so on from the financial crisis, the singular sense of purpose that drove a frenzy of regulatory interventions has faded.

Banks and insurers are so much safer now that regulators seem nonplussed about their resilience even as countries including the US and the UK flirt with recession, and the fallout from Russia’s invasion of the Ukraine threatens untold damage.

For financial regulators trying to recapture the relevance and adrenalin of the heady post-crisis era, crypto and climate are tantalising topics. The wild west of crypto offers regulators a platform to save hapless consumers from scams and idiocy, while protecting underlying technology that could improve all our lives. Climate offers the more legacy-minded regulators the chance to, literally, save the world.

But the two Cs that have replaced capital in regulators’ hearts and minds are fraught with difficulties.

Crypto is an area that many financial regulators cannot avoid getting involved in. There are rules prohibiting most individuals from putting their money into various bonds and complex products; it’s hard to argue that the same logic doesn’t apply to volatile crypto offerings.

There are also anti-money laundering issues that most regulators, and their governments, must address to make it harder for crypto to be used by criminals, tax dodgers and terrorists. And there are efforts to lay down parameters for the use of crypto in the mainstream markets world.

The challenge for…

Read more…