Keeping up with cryptocurrencies
How financial regulators used radical innovation to bolster agency reputation
Keywords:cryptocurrency, innovation, regulatory agencies, financial regulation, reputation management, Bureaucratic reputation
Invented in 2008 with Bitcoin, cryptocurrencies represent a radical technological innovation in finance and banking; one which threatened to disrupt the existing regulatory regimes governing those sectors. This article examines, from a reputation management perspective, how regulatory agencies framed their response. Through a content analysis, we compare communications from financial conduct regulators in the UK, US, and Australia. Despite the risks, challenges, and uncertainties involved in cryptocurrency supervision, we find regulators treat the technology as an opportunity to bolster their reputation in the immediate wake of the Global Financial Crisis. Regulators frame their response to cryptocurrencies in ways which reinforce the agency’s ingenuity and societal importance. We discuss differences in framing between agencies, illustrating how historical, political, and legal differences between regulators can shape their responses to radical innovations.
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Copyright (c) 2021 Lauren Fahy, Scott Douglas, Judith van Erp
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.