A group of four digital currency exchanges issued a press release Monday announcing the formation of the Virtual Commodity Association (VCA) Working Group. The VCA plans to hold its inaugural meeting next month, when representatives from Gemini Trust Company, bitFlyer USA, BitStamp, Inc., and Bittrex will gather to discuss the creation of an industry-led self-regulatory organization (SRO).
The VCA revealed that former New York Department of Financial Services Executive Deputy Superintendent Maria Filipakis will serve as its Interim Executive Director. She praised the exchanges’ commitment to the self-regulatory effort:
“I applaud the VCA and its members in their commitment to strengthen the digital asset industry's regulatory landscape, rules for the protection of customers, and bring forth industry setting best practices and market transparency.”
The group’s press release provided an overview of the main topics the Working Group expects to address in its September meeting, including membership guidelines for the organization and the selection of an Executor Director and members of the VCA Board of Directors.
In addition, the Working Group is expected to discuss the creation of best practices guidelines to “promote fairness, transparency, risk management, and liquidity” and “address Members conflicts of interest, client communications, client disclosures, and record keeping.”
The move to explore self-regulation is something that some U.S. regulators have been calling for in recent months. Earlier this year, CFTC commission Brian Quintenz suggested that the industry should work to create an SRO rather than waiting for federal authorities to regulate the industry:
"As Congress works with federal and state regulators to determine the appropriate regulatory framework for cryptocurrencies, I believe an SRO-like entity could develop industry standards that could inform, or even serve as a blueprint for, future government regulatory action.
An SRO-like, independent regulatory body could create uniform standards for these trading platforms, reduce the possibility of regulatory arbitrage, and avoid duplicative regulation."
Gemini Trust Company’s Head of Risk, Yusuf Hussain, noted that the VCA’s work is just beginning: “This is the first of many steps in policing the digital asset markets and answering the call of regulators.”