The Consumer Financial Protection Bureau (CFPB) is looking into the application of the Electronic Fund Transfer Act (EFTA) to the digital asset market. This law, which is commonplace in traditional finance, serves to protect users from losses due to unauthorized crypto transactions by requiring financial institutions to disclose their liabilities before such several types of transactions. The thorough application of the EFTA to oversee the virtual asset market would also require digital asset firms to make specific changes related to disclosures and other issues. The recent implementations of regulatory measures in the US, Canada and the UK are important steps in the creation of a secure and reliable space for virtual asset users. In the UK, the Financial Conduct Authority introduced crypto advertising rules which mandate firms to ensure their customers are informed about the risks associated to certain activities. Similarly, the Association of Securities Regulators in Canada issued a template for stablecoin issuers and guidance on the application of more regulation in the market.

These measures taken by governments and agencies intend to stop the malicious activities of bad actors that have been rampant in the crypto ecosystem. The CFPB is also looking into the role non-banks play in the crypto environment and have suggested the Treasury's Financial Stability Oversight Council to flag certain crypto activities as systemically important. Finally, digital asset firms and issuers will have to meet strict requirements in order to detect possible fraud and provide specified information on the use of consumer data before the issuance of private digital currencies.



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