Coinbase and affiliates have taken the lead on introducing a legal framework for blockchain tokens as a security; on Wednesday they released a 27-page framework for regulation and best practices for blockchain tokens; paper provides a risk score measurement, best practices for token sales and a detailed securities law analysis. Source
Business Insider has released a report on US regulation and fintech; says US regulation is a hindrance to the growth of the industry and is slowing its potential; the report titled, "The US Fintech Regulation Report," provides details on regulatory agencies' involvement with fintech and outlines their initiatives; explains the negative effects of regulation on the industry. Source
New regulations slowed the growth of P2P lending in China in 2016; data from P2P001 reports that transaction volume in P2P lending increased by 138% in 2016 to over 2.8 trillion yuan ($403 billion) however that was only half of the transaction volume growth reported in 2014 and 2015; on August 24, 2016 the government issued new requirements for the industry, one of which requires that lenders partner with banks for custodian services; this adds additional costs for lenders and as of the end of 2016 only 7.98% had partnered with a custodian bank. Source
Indonesia's Financial Services Authority has issued regulations for alternative lenders; the regulations are slightly less strict than expected; they require fintech companies to have capital of 1 billion rupiah ($74,239) when registering their business and capital of 2.5 billion rupiah ($187,210) when applying for a business license; the regulations do not set any limits on interest rates. Source
The UK's Cambridge Center for Alternative Finance (CCAF) is actively involved in industry research and is currently doing three alternative finance surveys; much of the research is in conjunction with the Financial Conduct Authority (FCA), providing insight for its crowdfunding consultation period; CCAF is surveying crowdfunding investors and crowdfunding borrowers; CCAF has also announced it will now be doing a survey on blockchain and cryptocurrencies; as part of the FCA's regulatory study, CCAF is working with 25 crowdfunding and P2P lending platforms in the UK to gain greater insight into the crowdfunding ecosystem. Source
Patrick McHenry is one of the most proactive advocates for fintech in Congress; at LendIt USA 2017 he provided his insight from Congress on fintech and also spoke with Lend Academy in their podcast; his views are framing many of Washington D.C.'s legislative debates and his legislation, the Financial Services Innovation Act of 2016 (HR 6118), could be a significant factor helping to support future fintech innovation in the US. Source
The Financial Conduct Authority has issued an update on its rules for the crowdfunding market; the update is based on feedback received since July and its authorization process; seems there will be a number of modifications; some of the key areas for new regulation in P2P lending include disclosure, wind-down plans, mortgage lending standards, cross-platform investment, investment limits, operational risk complexity, marketing promotions, provision funds, money handling standards, regulatory arbitrage, maturity mismatching, investment for institutional investors and liquidity risk for IFISA investors. Source
