Emerging analytics technology is the name of the game for the next stage in crypto regulation.
New York’s financial regulator is asking for new tools to gather real-time financial data.
On Thursday, the New York Department of Financial Services announced new details of its coming “techsprint” competition:
“The objective of the techsprint is to achieve creative and collaborative prototyping as a step toward smarter regulatory reporting in virtual currency.”
Namely, the DFS is using the two-week competition to get better access to data from crypto companies in real time. It’s first question reads:
“How can DFS achieve real-time or more frequent access to company financial data from virtual currency licensees and receive early warning signs of financial risks to the companies or their customers?”
The DFS is particularly interested in the analytical potential of “natural language processing, machine learning, and artificial intelligence,” which have become top priority technological capabilities for regulators around the world seeking to cope with overwhelming inputs of high-volume industry data. A department official told Cointelegraph: “We hope a range of actionable solutions emerge, including data driven technology tools.”
It’s taken centuries for regulators to get a grip on data inflows in traditional markets, and periodically someone finds new and exciting ways to falsify data. For crypto exchanges looking to fight market manipulation, it’s been an accelerated process — its own techsprint.
The DFS, presiding as it does over Wall Street, is often at the front line of the world’s sub-national financial regulators. For crypto, specifically, the DFS issues and administers the coveted “Bitlicense,” which has put it in particularly close touch with a roster of the biggest players in crypto. Regarding the participation of the regulated, a department official confirmed to Cointelegraph that some of these Bitlicensees were part of the workshops that led to this announcement.
The competition will take place in the first two weeks of March. The winners will receive no monetary prizes, though it seems likely that the competition is a good spot to show off potential tech tools and pick up government contracts. Registration is due by Jan. 26.
Competitions like this techsprint are a popular means for government organizations to check out new technologies from the private sector. In the fall, the Commodity Futures Trading Commission held its first science competition, “Project Streetlamp,” which focused on new analytical tools for identifying unregistered offerings in the U.S. The winner was crypto analytics firm Inca Digital’s “Nakamoto Terminal” platform.