Tokenization is the focus of the International Organisation of Securities Commissions (IOSCO), a standard-setting body that announced its annual plan on Friday.
The project will concentrate on tokenization use cases unique to the securities market and distributed ledger technology, building upon the IOSCO FinTech Task Force’s current crypto principles and guidelines. The plan states that the outcome will assist IOSCO in determining whether or not additional policy guidance is required.
“The objective of this work is to develop a shared understanding among IOSCO members on the adoption and current use-cases of asset tokenisation in the securities markets,” stated the paper.
Financial organisations and regulators have been embracing tokenization—the digitalization of physical assets—more and more. A tokenization initiative was recently started by several central banks. Companies were also encouraged to implement their tokenization methods by a report supported by the U.K. government. Significant financial firms like Blackrock joined the tokenization fray last month, and as technology develops, tokens like ONDO have been rising in value.
IOSCO has already made cryptocurrency a top priority. The group released its decentralised finance recommendations in December and its final recommendations for the industry in November. The strategy for IOSCO’s adoption of cryptoassets was also authorised last winter. The organisation intends to revise its 2020 report on investor education about crypto assets for retail investors this year and expects to create an assessment system by the second part of the year. According to the new policy, IOSCO also plans to investigate some of the issues that artificial intelligence poses
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