certify
Home arrow Article arrow Article Detail

CFTC and SEC Propose Changes to Reporting Crypto Exposure for Hedge Funds

Profile Image

Pavan A Follow

INDIA

Aug, 13 2022

Aug, 13 2022

likes | comments 0

Article Image

SEC and CFTC have proposed to require advisers who work with hedge funds to report their exposure to digital assets. Among the factors cited by the two U.S. financial regulators to justify the proposed change is the growth of the hedge fund industry, in part due to the growing popularity of digital assets investments. 


As part of the Securities and Exchange Commission proposal, large hedge funds would be required to file a confidential Form PF to report their cryptocurrency exposures. Form PF was developed after the 2008 financial crisis to help regulators identify bubbles and stability risks in a private fund industry that is otherwise opaque. 


After the financial crisis, regulators began imposing more stringent regulations on the banking sector, which slowed the growth of private funds' assets. 


In his statement, Gary Gensler, chair of the SEC, said, “In the decade since the SEC and CFTC jointly adopted Form PF, regulators have gained vital insight with respect to private funds.” 


He added, “Since then, though, the private fund industry has grown in gross asset value by nearly 150 percent and evolved in terms of its business practices, complexity [...] If adopted, this would improve the quality of the information we receive from all Form PF filers, with a particular focus on large hedge fund advisers.” 


Gensler, who was appointed by President Biden, has frequently emphasized the importance of investor protections in the cryptocurrency market and compared cryptocurrencies to the Wild West. During a virtual press conference, he said regulators are not aware enough of hedge funds' crypto exposure. 


Based on data from Coin Gecko, the total value of the crypto market has fallen from nearly $3.1 trillion in November to around $1.2 trillion recently. 


The Wednesday proposal also contains provisions requiring hedge funds with net assets over $500 million to report more information on Form PF about investment exposures and portfolio concentrations. 

 


likes | comments 0

Profile Image

Pavan A

CBW - External Analyst

INDIA

Comments
Data Centre Construction - World First artificial intelligence AI-Tech Utility Token
banner
Article
WMG team up with OpenSea to expand Web3 opportunities 

WMG?team up?with OpenSea?to expand?Web3 opportunities for artists. This platform will enable artists to?build and extend their fanbase in the Web3 community. The nonfungible token (NFT) marketplace..;

Disclaimer: The information is for informational purposes only.​ This advertisement does not constitute financial advice or any other advice. You should consult with a financial professional to determine what may be best for your individual needs. None of the information and/or content available through this advertisement is intended as an offer or solicitation of an offer to buy or sell, or as a recommendation, endorsement, or sponsorship of any company, financial product, security or commodity. To the maximum extent permitted by law, we disclaim any and all liability in the event any information, commentary, analysis, opinions, advice and/or recommendations prove to be inaccurate, incomplete or unreliable or result in any investment or other losses. In Making the investment decision, investors must rely on their own examination of the issuer and the terms of the offerings, including the merits and risks involved. Investments are speculative, illiquid, and involve a high degree of risk , including the possible loss of investment.