Welcome to the March edition of our Legal Digest in 2024, where we dissect the intricacies of asset tokenization regulations.
Throughout this series, we aim to navigate the complexities of transformative legislation, shedding light on its impact on the tokenization of assets and exploring the implications for investors, financial entities, and the broader market. Join us as we uncover the regulatory framework and unravel its implications in the world of asset tokenization.
So let’s explore what March brought to the table:
The Financial Stability Board (FSB) is taking proactive steps to address global financial stability concerns, particularly focusing on asset tokenization. In a letter released on 26 February, FSB Chair Klaas Knot outlined upcoming discussions with G20 finance ministers and central bankers, emphasizing priority areas such as non-bank financial intermediation, climate change, cross-border payments, and digital innovation. Knot also highlighted plans for reports on the financial stability implications of asset tokenization and AI in 2024. Additionally, the FSB will provide an update on the implementation of the G20 Roadmap on Crypto Assets, adopted in October 2023, with a progress report expected later this year.
The European Commission (EC) has enacted a Delegated Regulation supplementing the Digital Operational Resilience Act (DORA). This regulation delineates the criteria for designating ICT third-party service providers (CTPPs) as critical for financial entities, as per Article 31(6) of DORA. It aims to further refine the designation criteria, considering factors such as systemic impact, reliance by global and other systemically important institutions, criticality of supported functions, and substitutability.
BaFin has expanded its website’s FAQ section on the Digital Operational Resilience Act (DORA). This regulation aims to standardize cybersecurity and ICT risk rules across the financial sector, enhancing the European financial market’s resilience against cyber threats. The website provides an overview of DORA and updates on ESA consultations related to it. It clarifies ICT criteria, outlines BaFin’s role in overseeing critical ICT services, and explains reporting requirements for ICT issues.
