While the EU is putting rules in place, and Asia is opening its doors to it, the U.S. approach to fintech is running the risk of getting left behind.
That has led to some "jawboning", the informal policymaking usually associated with the Federal Reserve. Mere public acknowledgement that the economy may be accelerating or decelerating by the chair can suggest higher or lower interest rates in the future – and in the process spur Wall Street run-ups or sell-offs.
While jawboning arises at virtually every agency, it’s also becoming more important at the SEC, and therefore more important to financial technology.
Regulatory and policy insights for the financial technology industry
The SEC, Commodity Futures Trading Commission, the Federal Trade Commission, and the Federal Communications Commission are all agencies that by law are required to have members from both political parties to ensure ideological diversity. Deciding majority votes are usually cast by a chairman chosen by the sitting president. Consequently, the minority members have long had to resort to speeches to impact policy and public opinion, since their voting alone would not necessarily be enough to effectuate new rules.
These informal guidelines are arising largely due to four regulation issues that the fintech industry faces right now. To see those four issues, watch our Fintech Beat video.
Fintech Beat is CQ's newest online publication for clients covering financial technology policy and regulation.