On Oct. 14, in remarks delivered at the University of Michigan Law School, Deputy Assistant Attorney General Michael Murray, discussed the intersection of antitrust laws and the financial sector.
The remarks featured a mention of how emerging technologies, including blockchain, factor into regulatory plans. Murray started by noting that the financial services industry is undergoing a tech-driven transformation that is changing the way how entities do business and how the economy functions.
While these changes stand to benefit consumers with new and low cost products and services, Murray pointed out that rapid change also creates a window of opportunity for anticompetitive conduct and the problems it entails. Murray said:
“Incumbents may predict and resist their demise and seek to slow innovation and the growth of rivals, and market participants who should compete against each other can agree to act jointly to the detriment of consumers.”
According to the speech, the Antitrust Division is taking a more concerted and systematic approach to address these developments. They are “leaning in” and taking a “muscular” role in antitrust issues in fintech, financial markets, and banking.
In practice, this means three key changes. First, more aggressive policing of the antitrust laws in financial markets. Second, a plan to update the agency’s modes of analysis. And finally, a consideration of whether to revise the 1995 Banking Guidelines by requesting public comments on relevant issues.
Murray also stated the regulator’s intention to look to academia to help keep pace with the technology. The agency is considering an initiative to develop financial expertise, specifically concerning blockchain, machine learning, and artificial intelligence.
Per Murray’s speech, “We are relying on academic coursework offered by the MIT Sloan School of Management to provide valuable foundational insights into these technologies and their role in new and existing business models.”
“We are using this coursework so that the Division’s attorneys and economists can understand what effect these types of technologies can have on competition,” he added.
Interest in the cryptocurrency space is apparently slowly forcing regulatory bodies to take more defined stances. Current US Securities and Exchange Commission commissioner Hester Peirce’s friendly attitude toward crypto has made the financial watchdog seem less of a threat.
But broadly speaking, whether blockchain reaches its full potential or not largely depends on contextual elements – including social and political settings, and, critically, existing legal systems.