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Tighter Oversight Sought for Crypto markets

FILE: Representations of cryptocurrencies are seen in front of displayed FTX logo and decreasing stock graph in this illustration taken Nov.10, 2022
FILE: Representations of cryptocurrencies are seen in front of displayed FTX logo and decreasing stock graph in this illustration taken Nov.10, 2022

The crash of FTX exchange has injected greater urgency into regulating the crypto sector and targeting such 'conglomerate' platforms will be the focus for 2023, the new chair of global securities watchdog IOSCO said in an interview.

Crypto 'conglomerates' like FTX have emerged, performing perform multiple roles such as brokerage services, custody, proprietary trading, issuance of tokens all under a single roof that give rise to conflicts of interest, ISOCO chief Jean-Paul Servais said.

"For investor protection reasons, there is a need to provide additional clarity to these crypto markets markets through targeted guidance in applying IOSCO’s principles to crypto assets," he added.

Servais also said "We intend to publish consultations report on these matters in the first half of 2023."

Madrid-based IOSCO, or International Organization of Securities Commissions, is an umbrella body for market watchdogs like the Securities and Exchange Commission in the United States, Bafin in Germany, Japan's Financial Services Agency, and the UK Financial Conduct Authority, who all commit to applying the body's recommendations.

Cryptoassets like bitcoin have been around for years but regulators have resisted jumping in to write new rules.

But the implosion at FTX, which left an estimated one million creditors facing losses totaling billions of dollars, will help change that, Servais told Reuters.

"The sense of urgency was not the same even two or three years ago. There are some dissenting opinions about whether crypto is a real issue at the international level because some people think that it's still not a material issue and risk," Servais said.

IOSCO, which coordinates rules for G20 countries and others, has already set out principles for regulating stablecoins, but now the focus is turning to platforms which trade in them.

In mainstream finance there is functional separation between activities like broking, trading, banking services and issuance, with each having its own set of conduct rules and safeguards.

"Is it the case for the crypto market? I would say most of the time not," Servais said.

The European Union's new markets in cryptoassets or MiCA framework is an "interesting starting point" for developing global guidance as it focuses on supervision of crypto operators, said Servais, who also chairs Belgium's financial regulator FSMA.

"I think that the world is changing. We know there is some space for developing new standards about supervision of this kind of crypto conglomerates. There is an obvious necessity," Servais said.

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Meta Toughens Content Curbs for Teens on Instagram, Facebook

FILE - Woman holds smartphone with Meta logo in front of a displayed Facebook's new rebrand logo Meta in this illustration picture
FILE - Woman holds smartphone with Meta logo in front of a displayed Facebook's new rebrand logo Meta in this illustration picture

WASHINGTON — Meta on Tuesday said it was tightening up content restrictions for teens on Instagram and Facebook as it faces increased scrutiny that its platforms are harmful for young people.

The changes come months after dozens of U.S. states accused Meta of damaging the mental health of children and teens, and misleading users about the safety of its platforms.

In a blog post, the company run by Mark Zuckerberg said it will now "restrict teens from seeing certain types of content across Facebook and Instagram even if it's from friends or people they follow."

This type of content would include content that discusses suicide or self-harm, as well as nudity or mentions of restricted goods, the company added.

Restricted goods on Instagram include tobacco products and weapons as well as alcohol, contraception, cosmetic procedures and weight loss programs, according to its website.

In addition, teens will now be defaulted into the most restricted settings on Instagram and Facebook, a policy that was in place for new users and that now will be expanded to existing users.

This will "make it more difficult for people to come across potentially sensitive content or accounts in places like Search and Explore," the company said.

Meta also said that it will expand its policy of hiding results to searches related to suicide and self harm to include more terms.

Leaked internal research from Meta, including by the Wall Street Journal and whistle-blower Frances Haugen, has shown that the company was long aware of dangers its platforms have on the mental health for young people.

On the platforms, teens are defined as being under eighteen, based on the date of birth they give when signing up.

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