Definition ∞ An investor protection standard comprises rules and measures designed to safeguard individuals who invest in financial products or markets. These standards aim to ensure fairness, transparency, and accountability within financial dealings, typically through requirements for disclosure, anti-fraud provisions, and mechanisms for dispute resolution. They protect investors from misinformation, market manipulation, and the misconduct of financial intermediaries. Adherence to these standards builds trust and stability in financial systems.
Context ∞ The application of investor protection standards to digital asset markets is a significant area of regulatory discussion and development. Challenges arise from the decentralized nature of many crypto projects and the novel characteristics of digital tokens, which do not always fit existing securities classifications. Regulators worldwide are working to adapt or create new frameworks to extend adequate protections to participants in the rapidly growing digital asset economy.
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