Financial Watchdog FINRA Extends Deadline for Report on Crypto Activities

The United States Financial Industry Regulatory Authority (FINRA) is extending its scheduled deadline for firms to disclose Crypto-related activities.

The new notice was issued amid the on-going regulatory tensions last week, as regarding Facebook plans to release a digital currency, Libra and possible outcomes posed by the cryptocurrency. 

FINRA had last year, urged the member companies to disclose activities related to digital assets to their regulatory coordinator – whether the firm or associated individual or affiliates is engaged or plans to engage in activities related to digital assets.

The request also included the category of digital assets which are non-securities, such as cryptocurrencies like bitcoin.

While the deadline for the notice ought to be July 31 2019, the recent update from the regulator late last week, however, announces an extension until the same date in 2020.

FINRA said the new notice is to encourage each firm to continue to keep FINRA up to date if at all the firm’s should come up with new plans or activities relating to digital assets not previously disclosed.

“As securities regulators continue to provide guidance to members regarding the unique regulatory challenges presented by digital assets — e.g., Joint Statement on Broker-Dealer Custody of Digital Asset Securities — FINRA believes it is important to keep the lines of communication with members open on this important topic,” FINRA noted.

Companies are encouraged to promptly notify their Regulatory Coordinator in writing (including email) of such activity. 

However, FINRA said no need for additional notice if a firm has already submitted a continuing membership application (CMA) regarding its involvement in activities related to digital assets unless a change has occurred.

Earlier this month, the United States Securities and Exchange Commission (SEC) and the FINRA released guidance on the broker-dealer custody of digital asset securities, as a response for clarity, on whether the federal securities laws apply to digital assets, including cryptocurrencies.

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