FINRA (Financial Industry Regulatory Authority)

The Financial Industry Regulatory Authority is the largest independent, non-governmental regulator for securities firms doing business in the United States, operating under SEC oversight to protect investors by ensuring fair and honest broker-dealer conduct.

FINRA regulates approximately 3,400 brokerage firms and over 600,000 registered securities representatives, overseeing trading in equities, corporate bonds, securities futures, and options. In the crypto and digital asset space, FINRA's role has expanded as traditional broker-dealers seek to offer crypto securities products to clients. The organization requires broker-dealers handling security tokens or other crypto assets deemed securities to comply with existing rules on suitability, know-your-customer requirements, supervision, and anti-money laundering obligations.

FINRA has issued guidance on digital asset securities, emphasizing that firms must implement heightened supervision and controls given the technology risks, custody challenges, and valuation uncertainties in crypto markets. The organization examines member firms for compliance with rules on communications with the public regarding crypto investments, ensuring promotional materials are fair, balanced, and not misleading. FINRA also operates surveillance systems to detect potential market manipulation and insider trading in securities tokens traded on alternative trading systems.