US financial markets have long been burdened by a patchwork of obsolete, extremely complex, paternalistic policies. Meanwhile, the government’s failure to establish a regulation regulation for digital ownership, in conjunction with aggressive persecution of the industry, the change took place. Not surprisingly, the rest of the world moved forward, leaving the US behind.
Now, under President Trump’s leadership, we stand in a historical shift. His “biggest deregulation campaign in history” and “Revolution of Common Sense,” offers us a rare chance to remove artificial boundaries, retire philosophies, and re -reflect on our approach to regulating financial markets and asset ecosystems. Instead of creating and becoming tied by reactive regulations designed for previous crises and technologies, we can design flexibility, looking forward frameworks that promote change.
As I thought about these frameworks, I reminded the wisdom shared by the Securities and Exchange Commission Chairman Harvey Pitt (2001-2003), a Lion of the Securities Bar, who suggested a simple but deep solution To improve Equity Equity markets: Develop guide principles for our markets to gem. Chairman Pitt likens this to the Ten Commandments of God – clear principles to manage industry behavior that has been appointed to meet them.
Often, regulators and market participants failed in the minutiae of prescriptive laws and miss their primary intentions. While customs, standards and policies have their place, the “Ten Commandments” suggested here provide a strong foundation for future frameworks. The key is to first understand the purpose of federal security laws.
In their main, these laws manage transactions involving security – whether sharing a company, loan promises, or investment stakes. When people entrust you with their money, you owe them specific duties. Security laws are primarily a disclosure regime designed to ensure fair and transparent exchange that gives investors the information they need to assess the risks and rewards of their investments.
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These laws emerge after the stock market crash of 1929, which is -fueled by non -ethical skills such as insider trading and stock manipulation, and aggravated by asymmetry between consumers and Selling security. The Securities Act of 1933 and the Securities Exchange Act of 1934 were implemented to prevent these abuses and facilitate companies to gain capital, protect investors who invest their capital, and ensure that markets are Fair and efficient, while reducing burdens to honest business activities.
Despite the good intentions, these laws have become extremely complicated, stifling competition and limiting the investor’s freedom. In order to reimagine the financial market regulation, especially with emerging technologies and digital assets subject to security laws, we must return to principles that shape these laws – principles that promote the fairness while reducing burdens on honest businesses.
Based on Chairman Pitt’s vision, I evacuated basic values for market participants in the following Ten Commandments for a reliable market:
- You will reveal material information. The full and fair disclosure is the crux of security laws. Those who give should provide realistic, complete, and nondeciptive material information to investors so that they can make concluded financial decisions. Hiding or incorrect expression of critical information that affects income expectations distracts the trust and integrity of the market.
- Do not cheat or manipulate. Market fraud and manipulation have distorted the true value of security, harmful to investors and the market. Avoiding deceptive skills helps ensure fairness.
- Do not trade in non -public information material. Insider trading provides an unfair advantage to those who have access to confidential information. This ensures a fair field of play for all market participants.
- Tell the truth about your financial health. Financial statements should be accurate and clear, reflecting a company’s true financial condition, so investors can accurately assess the risks and make knowledgeable financial decisions.
- You will use all investors evenly. All investors must have equal access to material information and opportunities. It ensures fairness and prevents the benefits of insider and discrimination skills.
- You will reveal the dangers involved. Investors should be informed of the dangers associated with their investments so that they can produce choices that align with their financial goals and tolerance at risk.
- You will act in accordance with your duties to others. Participants in the debt -owned obligation of trust and responsibility, such as financial professionals and corporate directors, should act in the interests of their clients and shareholders, not for their own personal gain.
- You will try to avoid conflicts of interest, but if some are inevitable, you will reveal them. Participants in the market should avoid or reduce conflicts of interest, but if unavoidable, conflicts should be disclosed. Transparency allows investors to make decisions with understanding potential biases and preserving confidence.
- You guarantee the fair and transparent market. Markets should work based on true supply and demand, free from artificial distortion. It promotes trust and fair pricing.
- You will promote efficient and orderly markets. The markets should work properly, with transparent pricing and accessible for all participants. It promotes market stability and investor trust.
By focusing on these basic principles, we can create adjustable regulatory frameworks that coincide with technology advances and prevent obstacles of obsolete laws. This is the time for a seismic shift in financial regulation towards a approach that expects future markets and innovations. We can develop a future proof financial system that benefits everyone by ensuring clarity, fairness, and order while provoking change.
