NASDAQ closed door meeting regarding cryptocurrency

On Friday 27 July 2018, NASDAQ held a secret meeting in Chicago with attendees from half a dozen cryptocurrency companies and traditional exchanges.

Attendees also included the Winklevoss twins who co-founded Gemini exchange. Tyler and Cameron Winklevoss are keen players in the cryptocurrency market; they have founded the cryptocurrency exchange Gemini and are now seeking for the Securities and Exchange Commission to approve their Bitcoin Exchange-Traded-Fund (ETF), which was recently rejected.

Topics discussed in the meeting ranged from the future of cryptocurrency regulation and the tools that will be required if or when security tokens become regulated.

This is a positive step for the cryptocurrency market as it shows that large companies that are heavily involved in the current financial markets are accepting this new market and making provisions so that they can be adopted by the mass public.

As companies such as NASDAQ and Gemini are holding private meetings to discuss cryptocurrency regulation to protect their business, it is my suggestion that the SEC are looking to implement further cryptocurrency regulation.

Cryptocurrencies are broadly split into three different types, which Switzerland has enshrined in their FINMA Guidance.

Payment tokens are used as a traditional currency and to be used as a nominal way of exchange. The best example is the most popular cryptocurrency Bitcoin.

Utility tokens are intended to be used in exchange for specific application, product or service.

Asset tokens (Also known as Security tokens) are representative of a real asset such as a company, earning streams, entitlement to dividends or interest payment.

Asset / Security tokens are the most likely type of cryptocurrency to become regulated due to its similarities to conventional financial assets. That does not mean utility and payments tokens will not also be regulated.

NASDAQ provided several cryptocurrency exchanges with their market surveillance technology which is the industry bench mark for real-time solutions for market surveillance to ensure its compliance with regulation.

Cryptocurrency exchanges are currently not required to monitor its business transactions in this manner, however it shows that these companies and preparing for something.

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Thomas Hulme
Thomas joined Mackrell Turner Garrett as a Trainee Solicitor in September 2017, having previously run his own security business, specialising in protecting the IT infrastructure of SMEs and large enterprises. This commercial background gives him a unique insight into what it takes to establish and run a company. Before undertaking a position within the firm, Thomas completed a Graduate Diploma in Law and an LPC, but he now has plans to also undertake a Masters LPC with Business, alongside his training with the firm.