US’ Securities and Exchange Commission (SEC) has adopted changes to the Securities Exchange Act of 1934 that will see more broker-dealers come under the oversight of the Financial Industry Regulatory Authority (FINRA). This comes on the heels of SEC’s crackdown on cryptocurrencies earlier this year, during which the authority stepped up regulatory scrutiny on unregulated securities exchanges.

Explaining the move in a press release, SEC chair Gary Gensler says that there has been a “regulatory gap whereby a number of firms that have cross-market, monthly trading volume valued in the hundreds of billions of dollars are exempt from national securities association oversight”. He expects that these amendments will “update and narrow the circumstances in which broker-dealers do not need to register with a national securities association” and that “national securities association membership will help enhance robust and consistent oversight”.

The final rule will become effective 60 days after its adopting release is published in the Federal Reserve, while the compliance date is 365 days after publication.