The US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) launched a public consultation on Thursday, calling on the public to contribute to a proposed rule defining crypto hedge funds and their public disclosure.
The comment document was made available to the public on the Federal Registry site and seeks to collect the opinions of large hedge fund advisors and all filers about their strategies for investing as the commission considers proposed amendments to Form PF. Steps up, disclosing a confidential reporting form Business Day Program for SEC-registered investment advisors for private funds and certain commodity pool operators and commodity trading advisors.
“We are also seeking comment on the proposed rules and a number of options, including whether some potential changes to the proposal should apply to Form ADV,” the SEC and CFTC announced in a statement.
SEC amendments seek to increase oversight of hedge funds
Under the proposed amendments to the Form PF or Rule, the SEC intends to increase the disclosure of private equity and crypto hedge funds and increase oversight of the industry to mitigate potential risks.
“The amendments are designed to enhance the ability of the Financial Stability Oversight Council (“FSOC”) to monitor systemic risk, as well as strengthen the SEC’s regulatory oversight of private fund advisors and investor protection efforts. went.
Regulators will also change guidelines from the Investment Advisors Act of 1940, which requires a “temporary hardship exemption.”
“The proposal will add a new sub-asset class to digital assets and define the term ‘digital assets’ as a partially read statement.
SEC Chairman Gary Gensler told reporters last month that the proposed amendments require the largest financial firms to report on their complex structure, which would ensure transparency.
“We can at least play a part by increasing some transparency.” Agency president Gary Gensler told reporters.
The proposed investigation will be the largest in 10 years
If the amendments to the confidential filing are considered proposed, they would become one of the biggest regulations that have overseen investment fund trading in liquid assets over more than 10 years, according to analysts. Regulatory scrutiny began when hedge fund deleveraging caused turmoil in the US Treasury market in March 2020, and a “meme-stock” saga filled with obscure assets prompted the Biden administration to wallow in on obscure private funds. inspired to move. Markets are being adversely affected.
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