In three years, crypto trades could be required to undergo official reporting requirements. It is thought that the US will be one of the first countries to introduce such guidelines on trading platforms, according to a new survey conducted by business analytics firm IHS Markit in October.
Per the survey, which gathered data from 90 respondents at banks, asset management firms, brokers, and various other financial and non-financial institutions, a majority of respondents said they expect reporting requirements related to “post-trade transactions” to be introduced in at least three years. However, this could be sooner.
Post-trade transactions refer to trades made on centralised exchanges and other marketplaces for spot crypto assets. Furthermore, the expected reporting requirement is likely to apply to exchange and marketplace operators. It will not apply to individual traders.
The majority of respondents claimed that the US is most likely to introduce the regulations first. This makes sense considering that the US is one of the major players in the crypto market, with around 8.3% of the US population owning crypto.
Respondents expect the US to be followed by the European Union, the United Kingdom, Switzerland, and Singapore as the next most likely places to introduce reporting requirements.
Ronen Kertis, Head of Global Regulatory Reporting Solutions at IHS Markit, commented on the findings and said that they illustrate a degree of acceptance by companies in the crypto industry that we should expect to see tougher regulations soon.
“The speed with which transaction reporting is expected to be required for this relatively new asset class demonstrates that the market accepts both the necessity of and value in regulatory oversight of this type,” Kertis said.
Kertis then added that this suggests that companies working in the crypto sector “need to maintain a close watch” on signals from regulators as the market continues to evolve and expand. Furthermore, Kertis also commended some companies in the industry who he said have already chosen to report their crypto trades even though it is not yet required.
A report about the survey concluded, “Cryptocurrencies remain largely unregulated around the world but if their importance continues to grow at the pace they are sure to attract regulatory scrutiny.”
