October 19, 2018
by Matthew B. Comstock

The SEC launched FinHub on October 18, 2018.  According to the SEC’s press release, “FinHub will serve as a resource for public engagement on the SEC's FinTech-related issues and initiatives.”

FinHub is effectively a portal within the SEC’s website focused on the SEC’s initiatives in four areas:  blockchain/distributed ledger, digital marketplace financing (e.g., online marketplace lending and crowdfunding), automated investment advice (e.g., robo advisers) and artificial intelligence/machine learning.  The SEC states that it intends FinHub to:

  • Provide a portal for industry and the public to engage directly with SEC staff on innovative ideas and technological developments; 
  • Publicize information regarding the SEC's activities and initiatives involving FinTech on the FinHub page; 
  • Engage with the public through publications and events, including a FinTech Forum focusing on distributed ledger technology and digital assets planned for 2019;
  • Act as a platform and clearinghouse for SEC staff to acquire and disseminate information and FinTech-related knowledge within the agency; and
  • Serve as a liaison to other domestic and international regulators regarding emerging technologies in financial, regulatory, and supervisory systems.

At this point, FinHub appears to be largely a clearinghouse for information, guidance and actions relating to the four identified areas of initiative in the form of links to various documents.  For example, the area of FinHub dedicated to blockchain/distributed ledger technology includes links to the SEC’s 2017 DAO Report and various enforcement actions, among other things, and the area dedicated to digital marketplace financing includes a link to Regulation Crowdfunding, certain investor bulletins and data and other information related to crowdfunding.

The portal’s “Engage with FinHub” button is curious.  Clicking on it leads to a form that allows anyone to request a meeting with the SEC staff regarding FinTech matters.  While the SEC’s outreach is laudable, it seems unlikely that this form of engagement is going to lead to serious initiatives on FinTech matters.

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Blockchain technology utilizes a distributed digital ledger to record and track information, and can be leveraged to gain transparency and certainty in transactions ranging from cryptocurrency to supply chain tracking.  This blog provides information on the legal developments surrounding implementation of blockchain technology, with an initial focus on the financial services sector.