New York rolls out digitized financial reporting for digital currency firms

New York’s financial services regulator is launching its first-ever techsprint, an initiative that seeks to give the regulator instant access to data provided by firms under its supervision.

The New York Department of Financial Services (NYDFS) announced the techsprint in a press release, describing it as an initiative by regulators and industry stakeholders to work towards a common goal of digital regulatory reporting.

“This effort comes in the context of a trend by global financial regulators to employ techsprints as a mechanism to rapidly prototype technology solutions to key supervisory problems,” the regulator stated.

The techsprint’s first area of focus will be digital currency companies, the NYDFS revealed. This is due to their advanced capabilities operating in the digital space.

In a world that’s rapidly becoming digital, regulators need access to more immediate information about the financial and operational conditions of the firms they oversee, the Superintendent of Financial Services Linda Lacewell remarked. The COVID-19 pandemic has made this more apparent as it delayed reporting for most firms. Regulators also had to take up digital examinations of the firms they oversee to abide by the social distancing rules.

Lacewell stated, “With this first-ever techsprint series, the Department is making progress towards automating the reporting of financial and operational data by our regulated entities, enhancing collaboration between the Department and industry, and helping to foster a safer marketplace for the consumers who depend on it.”

The NYDFS will partner with the Alliance for Innovative Regulation and the Conference of State Bank Supervisors on the initiative. This will be the first of many techsprints, the regulator revealed, with subsequent initiatives set to focus on other types of nonbank entities.

The techsprint is expected to bring together fintech and digital currency professionals, their regulators and regtech experts. They will work on solutions relating to process improvements and a digital reporting mechanism. The NYDFS will then leverage the proposed solutions to develop a common standard that it could adopt moving forward.

“Design workshops are planned for this fall, with the techsprint itself anticipated to take place early in 2021.”

The announcement comes days after a report by the regulator on the July Twitter hack recommended the formation of a new regulatory body to police the social media space. The hack, which led to the loss of $118,000 in BTC from several victims, shows just how prone to attacks social media platforms are, the regulator claimed in its lengthy report.

See also: kompany’s presentation at CoinGeek Live 2020 on KYC On-Chain: Real-Time Business KYC for BSV.

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