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On October 18, The US Securities and Exchange Commission (SEC) announced the launch of the Strategic Hub for Innovation and Financial Technology, also named FinHub. The SEC is an independent federal government agency responsible for protecting investors, maintaining fair and orderly functioning of securities markets and facilitating capital formation.
The aim of FinHub is to provide public engagement about the issues and initiatives of the SEC’s FinTech. FinHub’s main objectives are to provide a portal for the public to engage with SEC staff on innovative ideas or technological developments and provide as a liaison to regulators regarding emerging technologies in the industry, for example blockchain start-ups.
This ambitious and forward-thinking project will be led by Valarie A. Szczepanik, Senior Advisor for Digital Assets and Innovation. In a statement the SEC Chairman Jay Clayton said: “The SEC is committed to working with investors and market participants on new approaches to capital formation, market structure, and financial services, with an eye toward enhancing, and in no way reducing, investor protection.”
This project is a significant move by the SEC, allowing for more transparent and innovative working for pioneering start-ups in the blockchain tech industry, lessening all of the red tape. This is a smart move, as the trend of easing and clarifying relations is continuing across the world. The SEC was heavily criticised in September for its actions against Tesla and crypto market.
The criticisms hit a new peak when Co-founder of TechCrunch, Michael Arrington announced that his venture capital company is leaving the US and moving to Asia. In a statement Arrington said: “We received a second subpoena from the SEC, again collecting information from us as investors in a U.S. company. The legal costs of dealing with these are not insignificant. We will not invest in any further U.S. deals until the SEC clarifies token rules.” Arrington even went as far to say that “the US has already been left behind” because of their heavy handed regulations stifling innovation in the market.
Time will tell how this project shapes the landscape of the finance industry when it comes to technological financial advancements from start-ups, but it’s certainly a step in the right direction from the SEC.
For more information about FinHub you can visit the page here, and if you find yourself wanting to engage with SEC you can use this form to request a meeting or assistance from SEC staff.