On December 16 the Financial Stability Oversight Council approved its 2022 annual report. The report includes recommendations related to digital assets. In its announcement of the report, FSOC said, “The Council emphasizes the importance of agencies continuing to enforce existing rules and regulations applicable to the crypto-asset ecosystem.  The Council has also identified gaps in the regulation of digital asset activities. 

To address these gaps, the Council recommends the enactment of legislation providing for rulemaking authority for federal financial regulators over the spot market for crypto-assets that are not securities. Steps should be taken to address regulatory arbitrage, since crypto-asset entities offer services similar to traditional financial institutions but do not have a consistent or comprehensive regulatory framework.  An assessment should be made of whether vertically integrated market structures can or should be accommodated under existing laws and regulations.  Finally, the Council recommends that Council members continue to build capacities related to data and the analysis, monitoring, supervision, and regulation of digital asset activities.”