GDF proposes voluntary standards for the global crypto asset market

In designing the standards, the GDF has taken advantage of the existing high-level framework and principles in the Global FX Code.

The global association of the crypto industry GDF (GBBC Digital Finance) has issued a consultation on a set of global principles aimed at promoting a “robust, fair, liquid, open and adequately transparent” market for crypto assets.

By issuing the Global Crypto Asset Standards, the GDF aims to enable market participants to confidently and efficiently transact at competitive prices that reflect available market information and in a manner that conforms to acceptable standards of behavior, supported by for a resilient infrastructure.

The standards are designed to apply to a wide range of participants who participate in crypto asset markets in different ways and across various products. They apply to both sell-side and buy-side entities, liquidity providers, crypto asset trading venue operators, and other centralized entities, namely large financial institutions, that provide brokerage, execution, and settlement services.

In designing the standards, the GDF has taken advantage of the existing high-level framework and principles in the Global FX Code. In certain cases, the standards include principles referenced in the Global FX Code without substantial revision, as they are directly analogous, applicable, and appropriate in a crypto-asset context.

In other cases, the GDF makes substantial revisions to the principles of the Global FX Code to address the specific risks of crypto asset markets. The standards also set out a number of new principles to account for unique risks in crypto asset markets.

The standards are organized around six principles:

• Ethics: Market participants are expected to conduct themselves in an ethical and professional manner to promote the fairness and integrity of the crypto asset market.
• Governance: Market participants are expected to have a strong and effective governance framework to provide clear accountability and comprehensive oversight of their activity in the crypto-asset market and promote responsible participation in the crypto-asset market.
• Execution: Market participants are expected to exercise care in trading and executing transactions in order to promote a robust, fair, open, liquid and appropriately transparent crypto asset market.
• Information Sharing: Market participants are expected to be clear and accurate in their communications and to protect confidential information to promote effective communication that supports a strong, fair, open, liquid, and appropriately transparent crypto asset market.
• Risk Management and Compliance: Market participants are expected to promote and maintain a robust governance and compliance environment to effectively identify, manage, and report risks associated with their participation in the crypto-asset market.
• Confirmation and Settlement Processes: Market participants are expected to implement robust, efficient, transparent, and risk-mitigating post-trade processes to promote predictable, smooth, and timely settlement of transactions in the crypto-asset market.

Like the Global FX Code, the standards include a “Statement of Commitment” form, which allows market participants to voluntarily register.

The Global Crypto Asset Standards, posted herethey are now open for comments.

Inquiries can be sent to the GDF Community Manager, Madeleine Boys, at [email protected].