Open-ended funds are not meaningfully leveraged while hedge funds are increasing their borrowings, said the International Organization of Securities Commissions (IOSCO) on January 4, 2022, in its expanded annual Investment Funds Statistics Report.
Financial Markets
ESMA consults on pilot DLT regulatory regime
Stakeholders are being asked for their views about a pilot regulatory regime for Distributed Ledger Technology (DLT) by the European Securities and Markets Authority (ESMA).
Chinese companies face tougher rules for offshore listings
Mainland Chinese platform companies seeking to list their shares abroad will have to pass a cyber security review beforehand if they have more than 1 million users on their databases – a law that becomes effective from February 15, 2022.
SEC proposes swing pricing for certain money market funds
Institutional prime and tax-exempt money market funds should impose swing pricing policies on investors looking to exit during periods of market stress, according to a proposal voted through at the US Securities and Exchange Commission (SEC).
FINMA encourages Swiss crypto boom
Switzerland has emerged as a hotbed of blockchain innovation and is pioneering capital market technologies thanks to the benign regulatory regime established under the Swiss Financial Market Supervisory Authority.
EU carbon price spikes spark calls for dedicated regulator
Calls are being made for a dedicated regulator to oversee the EU’s Emissions Trading Scheme amid warnings that dramatic speculative surges in the carbon price threaten support for the entire scheme.
US ‘meme’ stock rally raises questions around market efficiency
Extreme volatility in US ‘meme’ stocks earlier this year was characterised by some media outlets as a rebellion against Wall Street, but the reality according to the US Securities and Exchange Commission (SEC) was more nuanced and also highlighted potential market inefficiencies.
Well regulated dollar stablecoins may cancel out need for CBDCs
US regulators appear prepared to accept stablecoin issuers provided they meet tough criteria, implying that a US dollar CBDC might not be needed.
Banque de France demonstrates potential for bonds to be settled on blockchain
A novel experiment to settle French treasury bonds on a blockchain using a CBDC has market players excited about its potential to transform staid bond markets. Nevertheless, legal, political and technological challenges remain.
Legal risks still remain despite extensive preparations for Libor’s cessation
The clock is ticking for Libor, with all but dollar Libor tenors ceasing on December 31, 2021. Despite efforts to ensure a smooth transition, concerns remain over legacy contracts and how jurisdictional divergence will evolve.
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