Finance, Banking & Monetary Policy

Should Cryptocurrencies Be Regulated like Securities?

In less than a decade, cryptocurrencies have moved from the fringes of financial market activity to a $300 billion asset class traded on exchanges and owned by mainstream investors. Yet a great deal of regulatory uncertainty still surrounds cryptocurrencies. A new paper from Cato scholar Diego Zuluaga discusses how cryptocurrencies fit established regulatory practice, and proposes a framework to provide greater regulatory certainty to market participants and enable the growth of this new technology while fulfilling the policy objectives of the relevant regulatory agencies.

Your Money’s No Good Here: How Restrictions on Private Securities Offerings Harm Investors

Most of the time, one person’s cash is just as acceptable as the next person’s. Having cash in hand is good enough for any purchase one might wish to make. Federal securities laws do not adhere to this principle, however. Although almost anyone is permitted to buy shares in companies that have conducted a registered public offering, the private securities markets are far more exclusive. In a new paper, Thaya Brook Knight argues that current regulations governing the sale of private securities restrict investors’ access to investment in the guise of protecting them. But in fact this protection often prevents investors from taking the kinds of risks necessary to earn a return.

Wall Street vs. The Regulators: Public Attitudes on Banks, Financial Regulation, Consumer Finance, and the Federal Reserve

A new Cato Institute 2017 Financial Regulation national survey of 2,000 U.S. adults finds that Americans distrust government financial regulators as much as they distrust Wall Street. Nearly half (48%) have “hardly any confidence” in either. Americans do not think that regulators help banks make better business decisions (74%) or better decisions about how much risk to take (68%). Instead, Americans want regulators to focus on preventing banks and financial institutions from committing fraud (65%) and ensuring banks and financial institutions fulfil their obligations to customers (56%).

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Of Special Note

The Repeal of the Glass-Steagall Act: Myth and Reality

The Repeal of the Glass-Steagall Act: Myth and Reality

The Glass-Steagall Act was enacted in 1933 in response to banking crises in the 1920s and early 1930s. It imposed the separation of commercial and investment banking. In 1999, Glass-Steagall was partially repealed by the Gramm-Leach-Bliley Act. When the United States suffered a severe financial crisis less than a decade later, some leapt to the conclusion that this repeal was at least partly to blame. In a new study, international financial regulatory expert Oonagh McDonald argues that the notion that repealing Glass-Steagall caused the financial crisis, and that bringing it back would prevent future crises, is not supported by the facts.

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The Regulators Are Coming for Bitcoin

As cryptocurrencies hit new highs, is federal regulation far behind? And if it is, can regulators really do anything to crack down on these decentralized networks? Jerry Brito of Coin Center offers an analysis.

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Events

35th Annual Monetary Conference

After more than nine years of unconventional monetary policy, it’s time to question the Fed’s strategy and offer new ideas for the future of monetary policy. At Cato’s 35th Annual Monetary Conference, leading scholars, policymakers, and journalists examined the case for a rules-based international monetary system, considered steps to normalize monetary policy, debated the future of currency, and explored China’s future in the global monetary system.

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36th Annual Monetary Conference

Ten years after the 2008 financial crisis, we are again facing the possibility of economic turmoil as the Fed and other central banks exit their unconventional monetary policies. Although central banks will move gradually, unforeseen circumstances could trigger a flight to safety and a collapse of asset prices. Please join our distinguished speakers on Thursday, November 15, to discuss these and related issues.

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