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You are here: Home / Bitcoin Industry News / FINRA Considering Changes to Crypto Regulations to Better Protect Investors: Report

January 20, 2022

FINRA Considering Changes to Crypto Regulations to Better Protect Investors: Report

The CEO of the Financial Industry Regulatory Authority (FINRA) said the self-regulatory body will look at potential changes to crypto regulations this year as crypto adoption grows, Barron’s reported, citing a virtual conversation with Securities Industry and Financial Markets Association (SIFMA) CEO Kenneth Bentsen Jr. on Wednesday.

CEO Robert Cook said FINRA isn’t looking at making wholesale changes to current rules, but instead is planning to issue “an early-stage, concept release type of notice,” especially in the context of advertising and disclosure.

“We’re not looking to regulate or fundamentally change the regulatory structure here,” Cook said during the webcast, according to Barron’s. “That’s above our pay grade – that’s the SEC, other federal regulators, Congress, figuring out what is the appropriate rules of the road here.”

But Cook expressed concern that the range of regulators overseeing the various types of crypto assets could create confusion among investors.

“Our member firms today are involved in the sale of some digital assets – some securities, some not securities,” Cook said. “And when customers interface with one of our members and then buy a cryptocurrency or buy a digital asset, there are disclosure rules that apply today.”

Cook added that “we want to take this opportunity to talk about those [rules] and also to see if there are additional enhanced requirements that ought to apply, so that when people buy a product that’s not regulated…they may not know that they’re kind of flipping out of the broker-dealer regime into a different regime because they’re dealing with the same broker-dealer.”

Cook said that FINRA plans to publish its examination priorities for this year within the next month.

In October, FINRA advised its members handling crypto assets to ensure they had appropriate know-your-customer controls and processes to remain in compliance.

Author: Michael Bellusci

Filed Under: Bitcoin Industry News

Expert Witness

Ty Sagalow head shotTy Sagalow's unique background in legal, underwriting, policy drafting and claims – and his designation as a “qualified insurance expert” by the United States District Court for the Southern District of California – offers attorneys an unparalleled resource in D&O, E&O and Cyber insurance coverage disputes. He was also named "Most Helpful Expert" in a recent $8.7M coverage decision.

Mr. Sagalow served as Chief Underwriting Officer and General Counsel for AIG Executive Liability (formerly National Union Fire Insurance Company of Pittsburgh, PA), the world’s largest carrier of Directors and Officers Liability and Professional Liability Insurance. As General Counsel, Mr. Sagalow personally wrote or led teams that wrote all the D&O policies and many of the professional liability policies that AIG produced between 1988 and 2000 – policies which continue to serve as the foundational wording for the D&O and professional liability policies in the market today. As AIG Executive Liability’s Chief Underwriting Officer, Mr. Sagalow was charged with all underwriting interpretations and decisions for AIG D&O/E&O policies. In 2009, Mr. Sagalow headed up the team that rewrote all D&O policies for Zurich North America.

Ty is a cum laude graduate of Georgetown University Law Center and holds a LLM from New York University School of Law.

Bitcoin Insurance

Combining his talents as a network security insurance expert and an insurance product development expert, Ty Sagalow is the leading expert on the unique risk and insurance needs of the bitcoin industry.

With the successful sale of BitSecure(tm), the first bitcoin theft insurance policy in February of 2015, he is the first to create a sustainable, robust insurance policy to cover the theft of bitcoins and other virtual currency backed by an A-Rated, global “top 10” Property and Casualty insurance company.

Company Profile

Innovation Insurance Group is an insurance consulting firm and insurance brokerage founded by 30-year insurance executive, Ty R. Sagalow, former Chief Underwriting Officer, General Counsel and Chief Innovation Officer at AIG, and former Chief Innovation Officer at Zurich, NA and Tower Group. IIG focuses on three core practice groups: product development, expert witness services (primarily in the Management and Professional Liability areas), and bitcoin industry brokerage services.

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