Regulation
NYSE Would Consider Crypto Trading If Regulatory Framework Were Clearer, President Says at Consensus 2024
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NYSE President Lynn Martin is open to offering cryptocurrency trading, but the lack of clear regulatory guidance is an obstacle, he says.
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The U.S. regulatory environment will improve over the next two years, regardless of the election outcome, predicted Tom Farley, CEO of Bullish and Martin’s predecessor at the NYSE.
AUSTIN, TX — The New York Stock Exchange would consider offering cryptocurrency trading if the regulatory status of such an expansion by the stock market giant was clearer, the company’s president said.
“If there were clear regulatory indications [in the U.S.]it would be an opportunity to look at,” Lynn Martin said Wednesday during a panel discussion on Consensus 2024 in Austin, Texas.
US-listed spot bitcoin exchange-traded funds (ETFs), which have amassed $58 billion in assets, are “a strong signal” of demand for regulated crypto products, he added.
As traditional financial markets and digital assets become increasingly intertwined with more traditional financial heavyweights offering crypto products, a lack of regulatory clarity continues to weigh on the industry by slowing innovation, discussed Martin and Tom Farley, CEO of the cryptocurrency exchange Bullish, during the panel discussion. (Bullish is CoinDesk’s parent company. Farley previously held Martin’s job at the NYSE.)
To know more: The NYSE designs Bitcoin options, bringing another TradFi giant into the world of cryptocurrencies
“The fact that around $58 billion came into ETFs was a strong signal that the market is looking for regulation in traditional structures,” Martin said. “So hopefully the [U.S. Securities and Exchange Commission] I saw the inflows and said, ‘Hey, that makes a lot of sense,’ considering that bitcoin ETFs have been so successful.”
The NYSE’s US rival, the Chicago Mercantile Exchange (CME), a giant in regulated cryptocurrency futures trading, is planning to launch spot trading cryptocurrencies to customers, the Financial Times reported earlier this month.
Farley highlighted the sudden shift in sentiment towards cryptocurrencies in US politics, including the ouster of the anti-crypto chairman of the Federal Deposit Insurance Corp. (FDIC), the passage of the Financial Innovation and Technology for the 21st Century bill Act (FIT21) in the House, and Republican presidential frontrunner Donald Trump, who doubled down on his support for cryptocurrencies in a rapid chain of events.
“Five years of evolution happened in five minutes,” he said. “I’m really optimistic about what that means in this country. I think that, just like in Europe, just like in Hong Kong, regulators are codifying, ‘Hey, what’s your reasonable digital asset industry going to look like.’ “
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“You will see progress in 2024 and 2025, whether or not it’s Trump, Biden or Michelle Obama [will be president],” He added.
Martin said he continues to be optimistic about using blockchain technology to make financial processes more efficient and transparent, especially for less liquid assets such as municipal bonds.
However, Farley said traditional real-world assets will not migrate en masse to digital asset tracks, given regulators’ distrust of public blockchain. “Regulators want to put their sticky, power-hungry little fingers on everything,” she said. “How do you put your fingers on Solana? How do you put your fingers on something that’s decentralized?”
Therefore, regulators would likely push TradFi companies towards developing private blockchains instead of using existing blockchains for payments, he said.