Third Annual StarCompliance Crypto & Compliance Survey Shows Nearly Half of Firms Now Have an Employee Crypto-Trading Policy
Findings indicate firms are looking to gain further transparency into employee crypto-trading activity through compliance monitoring software
Rockville, MD – February 20, 2024 – StarCompliance (“Star”), a leading provider of employee compliance technology solutions, has released the key findings of its annual Crypto & Compliance Survey 2023, which examines how financial services firms are approaching employee crypto-trading from a compliance perspective. The third annual survey was conducted as a joint initiative with Aer Compliance, to build awareness of and provide greater clarification around firms’ state of readiness for monitoring employee crypto transactions and holdings.
Results show that 43% of the firms surveyed now have an employee crypto-trading policy in place, an increase of 6% compared to 2022. Of those who responded that they do not have such a policy in place, 23% intend to implement one this year. Some firms without a dedicated policy indicated that crypto assets are already captured in their existing conflict of interest policies, which refer to trading in traditional securities and digital assets, and therefore a separate policy was not required.
“As the regulatory landscape for digital assets continues to evolve, companies need to be ready to comply with new or updated rules. This starts with a serious examination of their existing compliance software, processes, and teams,” said Jennifer Sun, CEO at StarCompliance. “With the results of this survey, we are delivering new insights into the industry’s preparedness for any upcoming crypto regulatory frameworks, and the steps firms can take to stay compliant and competitive.”
Key findings from the Star’s Annual Crypto & Compliance Survey 2023:
- Less than half (45%) of respondents estimate that their employees invest less than 25% of their tradable assets in crypto – down 12% year-on-year. However, 51% still didn’t know how much of their employees’ tradable assets are invested in crypto, up from 39% in 2022.
- Millennial employees were identified as the generation that most actively trades crypto assets (32%). However, 61% of firms surveyed did not know which age groups are trading crypto assets, up from 27% in 2022.
- The number of respondents “not at all confident” in their understanding of how employees are trading crypto instruments in personal accounts increased 13% year-on-year. However, those who are “very confident” increased by 5% year-on-year. This indicates that while some firms’ policies have improved awareness of their employees’ crypto-trading behavior, many still need to look at how they can gain further transparency into employee crypto-trading activity.
- 39% of respondents expect that regulations and guidance for employee crypto-trading activity will come into force in the next 18 months, down 21%vs 2022, reflecting the lag in legislation compared to adoption of crypto trading.
- The majority of respondents (63%) are looking to monitor and manage employee crypto-trading risks by investing in or using compliance monitoring software. However, 18% are still waiting for further guidance from regulators before deciding how they should approach and monitor employee crypto-trading activities.
Find a complete breakdown of the survey findings here.
Annual Crypto & Compliance Survey
Star’s Crypto Pre-Clearance software solution enables firms to monitor the crypto assets their employees are trading, and take the first step toward preventing potential conflicts related to this. Key capabilities include trade-request pre-clearance: allowing employees who want to trade and sell crypto to do so easily while providing the business with visibility into this activity.
In August 2023, Star partnered with Aer Compliance to provide customers with a more holistic approach for managing employee crypto trading, monitoring material non-public information (MNPI), and supervision of securities and digital assets.
About Aer Compliance
Aer Compliance is the first employee trade compliance solution for digital assets. With a customer base comprising the largest banks, funds, and market makers globally, Aer’s software brings robust controls to this world of emerging risks. As regulators increase their scrutiny of crypto, Aer is the essential way to ensure appropriate measures are in place to protect both the firm and its employees. Argus’ US federal public sector work further informs its cutting-edge approach to compliance. You can find out more about the solution at www.aercompliance.com
About StarCompliance
StarCompliance is the world’s leading provider of employee compliance technology solutions. Trusted for over 25 years by more than one million users in 114 countries, Star’s next-generation platform and user-friendly interface delivers the data, technology, and actionable insights needed to proactively mitigate risk, monitor conflicts globally, and support complex whistleblowing regulations. Visit www.starcompliance.com to discover the comprehensive security and unparalleled assurance you need to build a culture of compliance today.
