grappling with yet.
similar projects by BigTech firms is not
necessarily reflective of a wider trend for
The FSB’s interest may signal the advent
likely to be the same as for the cryptoasset
the cryptoasset industry. This is because
of a coordinated approach internationally vis
industry, as the former raise fewer novel
regulators can apply existing and familiar
a vis cryptofinance development. However,
issues for regulatory extension than the
financial regulation paradigms more easily
we argue that this is likely limited to Libra and
latter. The opportunity that Libra provides
to the Libra Association, mainly its leading
similar projects led by “BigTech” firms. Such
in kickstarting regulatory discussions at the
founding member Facebook. The cryptoasset
firms, unlike cryptoasset developers, are likely
international level can pave the way for more
market is still likely to give rise to diversity
to adopt a platform model for their business,
consideration of coordination. This could
and should facilitate the discovery of new
allowing them to gather network effects and
happen if cryptoassets are written in Libra
bases for regulatory thinking and policy,
to centrally manage and extract rent on a
and extend the scale of both mainstream
uncoordinated or otherwise.
continuing basis. These corporatized entities
and blockchain-based business adoption of
that are commercial in nature are familiar
the private currency. Until then, cryptoasset
subjects to which regulators can easily attach
developers can choose from ethereum, Tezos,
regulatory obligations, whether in terms of
EON, Tron infrastructures and others,
registration as payment services provider,
operating in a diverse market which may yet
collective investment fund, derivatives
to give rise to signs of systemic importance.
trader, or continuing compliance. In other
D. Conclusion
words, the familiar institutions of financial regulatory capitalism
The ICOs market has challenged
can apply to BigTech
financial regulators in terms of determining
firms in relation to their equivalent financial
a fit with existing regimes and consideration
functions in the relevant sector. Indeed,
for regulatory reform. Regulatory divergences
BigTech firms are likely to attract systemic
have emerged in a number of jurisdictions
risk monitoring by regulators
as many of
and we discuss three dominant approaches
them have vast social footprint. Zetzsche et al
in relation to hegemonic, self-regulatory
argue that it may not be altogether clear that
and enabling regimes. These reflect different
international standards would be introduced,
assumptions and regulators’ understandings
but regulators dealing with BigTech firms
of the cryptoasset industry. To which we
with vast social capital and resources may
argue that the “terms for competition” in
be incentivised to cooperate in multilateral
relation to supply and demand side needs
forms of action, such as leveraging upon
are still being discovered and are incomplete.
established supervisory college structures244
This provides a unique opportunity for
for supervising “too-big-to fail” financial
regulators to jettison familiar assumptions
institutions. Further, regulators may also
in relation to corporatized securities issuers
be able to harness supervisory economies of
or institutional investors in order to discover
scale between themselves by giving equivalent
what governance needs are truly at stake.246
or mutual recognition to other regulatory
This may pose challenges for coherence
regimes. Within the EU, such coordination
with existing regulation, but coherence itself
may also be led by policy levels at the
should not be an obstacle for learning and
European Commission or the European
potentially reforming. We also argue that
System for Financial Supervision.
signs of international regulatory coordination
242
243
245
The regulatory trajectory for Libra and
in relation to the Libra project are not 21
Currents 24.2 2021
