Two prominent US regulators are looking to add enhanced crypto-disclosure guidelines for private hedge funds.
According to the post press releaseThe US Securities and Exchange Commission (SEC), in conjunction with the Commodity Futures Trading Commission (CTFC), is proposing improved reporting rules for large private funds.
Updated regulations require funds to provide Specific details of their investment strategies and financial positions, including crypto assets.
The Securities and Exchange Commission says the new guidelines will strengthen protections for investors and help the regulator maintain appropriate oversight of the industry.
As SEC President Gary Gensler stated,
“In the decade since the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) jointly adopted the PF model, regulators have gained vital insight into private money. Since then, though, the private fund industry has grown in Total asset value is around 150% and has evolved in terms of business practices, complexity, and investment strategies.
I am happy to support the proposal because, if adopted, it would improve the quality of the information we receive from all Form PF providers, with a particular focus on large hedge fund advisors. This will help protect investors and maintain fair, orderly and efficient markets.”
The PF form is what private fund advisors use to report assets under management to the Financial Stability Oversight Board (FSOC) so the agency can monitor risk.
However, Securities and Exchange Commission Commissioner Hester Pierce opposing The idea, saying the revised rules would be to “add questions that are nice to know, rather than need to know diversity” to the PF model.
“Today’s proposal extends to a very limited data collection tool that is beyond its intended purpose…
Private fund investors—typically, institutional investors, such as insurance companies, college endowments, pension funds, and high-income and net worth individuals—are able to make their own risk assessments.
The Securities and Exchange Commission should not step in to protect them when their investments are not working as hoped.”
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