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Crypto in the Spotlight: What Companies Can Do to Prepare for Regulations

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A new type of March Madness has arrived. All eyes are on players in the crypto arena.

As one who follows search engine optimization and keyword indexing for a living, I’m no stranger to metrics, but even these caught my attention. Check out these Monthly Search Volume (MSV) figures:

  • Cryptocurrency: 823,000 MSV (as much as “Adobe”)
  • CBDC: 12,100 MSV
  • Digital dollar: 3,600 MSV

What’s it all about? An as-yet unregulated currency is now being recognized for its impact on the economy, in this country and around the world. Those companies involved in Central Bank Digital Currencies (CBDC) are now in a race against the clock to prepare for regulatory readiness. Here’s a quick run-down of the latest.

The Executive Order issued by President Biden on March 9, called for research and reporting by a broad range of departments and agencies. Specifically, the Executive Order noted:

Within 180 days of the date of this order, the Secretary of the Treasury, in consultation with the Secretary of State, the Attorney General, the Secretary of Commerce, the Secretary of Homeland Security, the Director of the Office of Management and Budget, the Director of National Intelligence, and the heads of other relevant agencies, shall submit to the President a report on the future of money and payment systems, including the conditions that drive broad adoption of digital assets; the extent to which technological innovation may influence these outcomes; and the implications for the United States financial system, the modernization of and changes to payment systems, economic growth, financial inclusion, and national security.

The Executive Order further stated:

“The principal policy objectives of the United States with respect to digital assets are as follows:
We must protect consumers, investors, and businesses in the United States. The unique and varied features of digital assets can pose significant financial risks to consumers, investors, and businesses if appropriate protections are not in place. In the absence of sufficient oversight and standards, firms providing digital asset services may provide inadequate protections for sensitive financial data, custodial and other arrangements relating to customer assets and funds, or disclosures of risks associated with investment. Cybersecurity and market failures at major digital asset exchanges and trading platforms have resulted in billions of dollars in losses. The United States should ensure that safeguards are in place and promote the responsible development of digital assets to protect consumers, investors, and businesses; maintain privacy; and shield against arbitrary or unlawful surveillance, which can contribute to human rights abuses.”

Not surprisingly, its issuance was covered far and wide by media, including a Reuters newswire report, “Biden orders government to study digital dollar, other cryptocurrency risks”. This followed the Federal Reserve Statement issued January, 2022, “Money & Payments: The U.S. Dollar in the Age of Digital Transformation”. In the midst of the obvious global attention on cryptocurrency, it all adds up to one thing: regulations are coming. Compliance will be critical. And while no one seems quite certain when or how that will play out, those firms which will be impacted are in hot pursuit of ways and means to ensure they’ve got resources to manage whatever regulatory compliance programs the government will be establishing.

Considering the top priorities these companies will need to address as regulations come onto the scene, the opportunities to leverage AI-powered platform technology appear are clear. That said, it is yet to be understood just how much time or emphasis the companies have placed on regulations to date.

When it comes to regulatory preparedness, there’s no time to wait.

The race to resources and compliance readiness is now. Those who first and best leverage solutions to navigate the complicated landscape ahead are poised to gain a competitive edge.

And resources do exist. Taking a cue from financial services leaders whose marketing technology teams have sought and found solution partners, crypto firms are wise to follow that lead. As a company that prides itself on resourcefulness and innovation, we’re going to cut to the chase. Here, then, a primer in ways regulated companies can put best practices into play.

What’s a crypto compliance team to do?

Shoring up resources is a critical first step. Collaborating with those who have innovative and proven technology in place to address the challenges of regulatory compliance will bring value to crypto companies new to this landscape. The emergence of innovative, trusted, automated assistants, via cloud technology, relied upon for years by leading financial services companies across the country, helps compliance and legal teams ensure accuracy and reduce risk, without slowing down ambitious workloads.

It’s clearly a fast-paced, fast-growing industry. The President’s Executive Order stated that 16% of American adults have invested, traded, or otherwise used cryptocurrency. As these numbers are likely to increase, and companies in this arena seek competitive advantages, the search and discovery of the most efficient compliance and disclosure systems will be key.

It’s certain to get complicated. Whether to execute more offers, expedite speed-to-market, or prepare for full compliance with anticipated, as-yet-undefined regulations, marketing teams within cryptocurrency companies will best be served by leveraging automated solutions that employ Artificial Intelligence and Machine Learning capabilities.

The Why Behind AI for Marketing Compliance

There are four core ways AI platform technology benefits regulatory compliance efforts:

REDUCES RISK

by reviewing more content with greater accuracy

INCREASES PRODUCTIVITY

by reducing review cycle times and enabling more content and offers with confidence

DRIVES CONSISTENCY

by having a comprehensive rules-based assessment that guides your review and approval process

IMPROVES AUDITABILITY

by centrally managing all evidence in one source of truth thereby supporting credible challenges

As banking institutions, wealth management firms and fintech businesses increase their focus on all things compliance, so, too, do their martech teams increase their consideration of partnerships to get to the business of regulatory compliance. Learning about, and leveraging, solutions and collaborating with partners to solve these vexing obstacles along the way is an important step to finding pathways to better personalization, productivity and profits. Stay tuned and stay ready with resources which help navigate a changing, complicated landscape.

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