As an advisory board member for AltCourt.org in New York, Braeden Anderson formerly worked with the Financial Industry Regulatory Authority (FINRA). Braeden Anderson supports this not-for-profit organization in its mission of improving investor protection and market integrity.FINRA recently requested information from its member firms regarding cryptocurrency-related activity. Topics of interest to FINRA include trading of cryptocurrencies, accepting cryptocurrencies from customers, dispensing with crypto-related advice, managing pooled crypto funds, and participation in token sales. It has also requested information on the practice of mining, in which miners earn rewards for participating in blockchain recording and other unspecified uses of blockchain technology.Participation in this regulatory notice is not mandatory, but comes as part of a comprehensive set of efforts by FINRA regarding the use of digital assets. Some individuals and organizations have committed fraud and other violations of the law using digital currencies and other assets, and FINRA seeks to build comprehensive data on the issue and encourage caution among investors regarding new types of assets.
Before his recent graduation from law school, Braeden Anderson served as a legal extern at the regulatory agency FINRA, which is increasingly focused on the emerging field of cryptocurrencies. Braeden Anderson keeps abreast of changes in the regulation of digital assets and serves as an advisory board member in cryptocurrency and blockchain for AltCourt.org.The digital-assets market has grown significantly over the past few years. Cryptocurrencies, virtual coins, and tokens have become more common in the financial world. This growth has attracted many retail investors. FINRA is committed to protecting investors from fraud and securities violations. In this regard, FINRA recently issued a notice encouraging member firms to disclose their participation or intended participation in the digital-asset space. The notice, released on July 6, 2018, encouraged member firms to notify FINRA or its associated affiliates on whether it engages in activities relating to digital assets. FINRA defines participation in the digital assets market broadly to include (but not limited to): -Purchasing, selling, or otherwise executing digital-asset transactions, whether individually or through pulled investments.
-Providing advisory services for digital-asset transactions.
-Purchasing, selling, or executing derivative transactions tied to digital assets.
-Participating in initial coin offerings.
-Creating platforms to support digital-asset trading.
-Mining cryptocurrencies.
-Accepting cryptocurrency payments.
A law student at Seton Hall University, Braeden Anderson possesses long-standing interest in securities regulation, with a particular focus on algorithmic trading. Braeden Anderson is currently undertaking a legal externship with the Financial Industry Regulatory Authority, Inc. (FINRA). The industry-funded regulator has oversight of 3,700 brokerage firms, as well as 630,000 registered representatives, and recently proposed steps to increase actions against churning. This practice involves brokers trading excessively using client accounts, with an aim of boosting their revenues.The proposed new regulation would not require the broker to have control and discretion over the client’s account in order to be liable for churning it. At issue are situations where the customer relies on guidance from the broker, although the client authorizes investment buying and selling within the account. For clients used to brokers making decisions for them, the potential for churning may not be evident and such activities go unnoticed. Even with the change in rules, FINRA would require that, in specific cases, it must be demonstrated that the transactions at issue were “excessive and unsuitable.”
