Ten cryptocurrency industry titans have banded together to form a working group in a bid to formalize a number of positive standards for the digital currency market.
The Association for Digital Asset Markets (ADAM) is looking to leverage the joint expertise of its members and partnerships across financial firms and regulatory experts, in order to “devise a code of conduct for digital asset markets”, as stated on the official ADAM website.
Using the decade that has passed since the publication of the Bitcoin whitepaper as a point of reference, ADAM argues that “the world is still coming to terms with its implications” and that digital assets are a major opportunity, one of which the government regulators and market participants are finding extremely challenging to navigate.
ADAM’s website states four primary objectives:
- To protect market participants from fraud and manipulation;
- To provide clear rules and standards for efficient trading, custody, and the clearing and settlement of digital assets;
- To encourage professionalism and ethical conduct by market participants; and
- To increase transparency and provide information to the public and governments about digital asset markets.
The founding members of ADAM include fintech company Paxos, over-the-counter (OTC) crypto dealer Genesis Global Trading, world-leading multi-asset quantitative trading firm Hudson River Trading, and market-leading institutional smart contract platform Symbiont.
According to BusinessWire, ADAM is to be the “first broad-based organizations of its kind in the United States to proactively seek comprehensive standards for digital asset market participants”. That said, it isn’t the only consortium seeking to set straight particular issues of compliance, taxation and others for the blockchain and cryptocurrency industry, an undertaking of which Washington-based “The Blockchain Association” has set out to achieve.
ADAM is also said to be working with “current and former” regulators so that appropriate rules for “efficient trading, custody, clearing and settlement of digital assets” can be created. Furthermore, it references new guidelines to promote professional and ethical conduct by market participants, encouraging transparency to regulators and the public, and curbing market manipulation.
ADAM Advisory Board Member and former CEO of the New York Stock Exchange, Duncan Niederauer, likened the establishment of these fundamental rules to those set 200 years ago by market leaders who together, drafted the rules which led to the eventual creation of the New York Stock Exchange. He said, “The advent of digital assets requires a similar effort.”
Much like The Blockchain Association, ADAM will be pushing guidelines for risk management, know-your-customer (KYC), anti-money-laundering and so on. Entities such as these have some major benefits for the industry at large, which at present is undergoing radical transformations in the wake of major regulatory shifts and the ongoing professionalization of the industry, spurred by institutional investment from venture capitalists (VCs).
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