It’s all about the alternative assets. Companies that have cryptocurrency assets for their clients will have to put that on their balance sheet. There is also a growing risk on how to safeguard this digital assets, in a new accounting bulletin by the SEC.
This is likely to impact balance sheets of exchange companies such as Robinhood that is not yet factoring crypto in the latest shift in accounting. The growth of regulatory requirements on firms that hold crypto assets is set to grow as the assets become more of a stable in many investors’ portfolio.
More importantly, this is to combat crypto theft especially in the light of the recent Axie Infinity case where $600 million was stolen in tokens. Nonetheless, the SEC current views will not affect these type of Defi platforms yet since they are not registered under the purview of the SEC.
📍Cryptocurrency: Regulation on the way in Europe💰
As investors park more assets in the alternative realm, such as cryptocurrency, there is a call for more regulation on the asset class, although there’s no certainty on the framework. There is a deadline to register digital assets businesses in the UK that are expiring soon. This had caused some companies to plan for an exit.
Indeed, the UK had implemented a hardline on the industry. The Financial Conduct Authority (FCA) intends to stop the registration of cryptocurrency companies on 1 April, as it will impose regulations compliance to combat the possibility of money laundering and counter-terrorism financing loopholes.
Under the mask of such acts is to protect consumers and maintain financial stability. Indeed, Pika World will be focusing closely on the latest development.
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