Weekly Roundup

SEC Gamification Paper
All eyes are on an upcoming SEC sweeping consultation on gamification and rules governing retail brokers, robo-advisors, and wealth managers. SEC Chair Gary Gensler indicated that the agency is in the early stages of looking at whether firms’ digital customer engagement innovations should be governed by existing rules or may need new ones.Some of those innovations include artificial intelligence-led revolution in predictive analytics, differential marketing and behavioral prompts designed to optimize customer engagement and impact of interfaces on fairness and bias.

Cryptocurrency and Infrastructure Bill
The House returned early from Congressional recess to work on further infrastructure and spending legislation, with more discussion of cryptocurrency provisions to come. This has been described as a “political awakening” for the crypto community and the birth of the one-issue“crypto-voter.”

Source Code Theft
Media reports of source code misappropriation continued. Proofpoint Inc was awarded $14 million by a jury for source code misappropriation after a finding that a former employee and a French technology company misappropriated trade secret protected source code.

Bitcoin Futures Launch in Europe
Europe’s first-ever Bitcoin (BTC) futures will reportedly launch next month on Eurex, the continent’s largest derivatives market. Political uncertainty remained regarding approval of a Bitcoin ETF in the United States.

The rise of “DeFi,” or decentralize finance, protocols continued to garner media attention, with data in “Why is DeFi Taking Over the Banking World?” indicating that between 2020 and February 2021, users had invested close to $20.5 billion in different DeFi protocols.

Payment for Order Flow
The House has yet to consider a bill advanced out of the House Financial Services Committee last month to require the SEC to conduct a study within 18 months on whether to ban payment for order flow.

In the Mix: This Week’s Top FinTech Thought Leader

  • Sanjay Wadhwa was appointed to be Deputy Director of the SEC’s Division of Enforcement. Wadhwa previously was Senior AssociateDirector of the Division of Enforcement in the New York Regional Office.
  • Brett Redfearn, former head of Goldman Sachs Asset Management, spoke about the future of fintech, and noted that US Banks need abetter approach to fintech
  • Brian Brooks, Coordinator, The Better Identity Coalition, testified before the Congressional Task Force on Artificial Intelligence on the importance ofcreating
  • Ashley Gunn, former aide to Rep. French Hill (R-AR), has joined the legislative team at CoinBase.
  • Haimera Workie, Head of Innovation at FINRA, discussed diversity in cloud computing and FINRA’s recentlyreleased study on“Cloud Computing and the Securities Industry.”