Prioritization and Mutualization: Clearinghouses and the Redundancy of the Bankruptcy Safe Harbors
This Essay argues for the repeal of the bankruptcy safe harbors for financial contracts because they are redundant systemic risk safeguards. Most systemically important types of financial contracts now clear through clearinghouses. Clearinghouses are a superior method to the safe harbors for protecting the liquidity of systemically important money substitutes and do not subordinate bankruptcy policy concerns to systemic risk concerns. Clearinghouses are a better guaranty against systemic disruption than the safe harbors because they can absorb the losses caused by insolvencies and fire sales due to their deep capital and lack of leverage. Moreover, clearinghouses reduce systemic risk by forcing internalization of systemic externalities on the finance industry through loss mutualization. This reduces the industries incentive to engage in excessively risky transactions. And, in the event that losses overwhelm clearinghouses, they are technically and politically easier to bail out than individual firm when the safe harbors prove inadequate. Accordingly, this Essay argues for the safe harbors to be replaced with a clearing mandate only for those types of highly liquid financial contracts that serve as money substitutes.
Decoupling Tokens From Trading: Reaching Beyond Investment Regulation for Regulatory Policy in Initial Coin Offerings
Initial coin offerings (ICOs), a means by which technology entrepreneurs raise finance from members of the public to fund the development of innovative technology projects, has become a growing market. About 50 ICOs have raised over $1 billion in the first two months of early 2018, with the top ten ICOs raising between the equivalent of $36 to $100 million.1 In the absence of wellaccepted institutions of financial markets regulation, it is an astonishing phenomenon to witness the appeal and growth of the unregulated ICO markets. 
The innovative structures of "tokens" or "coins" offered in ICOs do not fit neatly into existing fund-raising regulatory regimes, and the international/borderless nature of ICO markets defy national enforcement.2 However, the US SEC issued a report in mid-2017 to classify certain tokens as securities and offers of such tokens would need to comply with securities regulation or exemptions to such regulation.3 Although the EU and UK have not issued precise clarifications on regulatory treatment, the European Securities and Markets Authority and the UK Financial Conduct Authority have warned that existing regulatory regimes may apply to ICOs depending on how they are structured and that investors should be aware that these are high-risk and unregulated investments.4 
There is understandably concern over regulatory arbitrage--whether ICOs are merely a means of using technological innovation to obfuscate the true nature of an investment offering, and therefore avoiding regulatory compliance. This regulatory avoidance potentially jeopardises investors by not adhering to standards of investor protection enshrined in securities and financial regulation. On the other hand, ICOs may defy regulatory classification because they could be truly innovative in terms of redefining asset classes and the fund-raising process. This article argues that instead of attempting to fit ICOs within the current definitions of financial instruments that may most resemble the ICO, such as "securities" or "collective investment scheme", both of which attract the need for regulatory approval and compliance with regulatory requirements, policy makers should consider more broadly how regulatory policy should be conceived: (a) in relation to the development of asset classes in financial innovation; and (b) how the balance of investor protection and fund-raising should be achieved. 
*I.B.L.J. 266 The first section discusses the development and characteristics of ICO markets in terms of primary markets (where subscription is made directly for ICO tokens as offered by ICO issuers) and secondary markets (where tokens are traded and resold amongst market participants). The second section discusses the potential application of regulatory classification to ICOs, comparing the US SEC's approach to the EU's and UK's potential approaches in securities and collective investment scheme regulation. We argue that there are genuinely distinguishing characteristics in ICOs and that an approach that forces "coherences" is counterproductive. We suggest that the primary markets should be governed by proportionate buyer protection regulation that adheres to common standards in consumer protection, but these are not necessarily at the same level as investor protection. 
The third section argues that investor protection issues really only arise in relation to the secondary markets where tokens are traded like derivative financial contracts and a regulatory framework can be considered to achieve the protection of market participants. We sketch the contours of such a framework. We argue that our suggestions form a package of proportionate reforms for policy makers, addressing key market protection needs while paving the way for asset innovations to take place and access to finance to be facilitated. The final section concludes.
Payment System Disruptions and the Federal Reserve following September 11, 2001
The monetary and payment system consequences of the September 11, 2001, terrorist attacks are reviewed and compared to selected U.S. banking crises. Interbank payment disruptions appear to be the central feature of all the crises reviewed. For some the initial trigger is a credit shock, while for others the initial shock is technological and operational, as in September 11, but for both types the payments system effects are similar. For various reasons, interbank payment disruptions appear likely to recur. Federal Reserve credit extension following September 11 succeeded in massively increasing the supply of banks’ balances to satisfy the disruption-induced increase in demand and thereby ameliorate the effects of the shock. Relatively benign banking conditions helped make Fed credit policy manageable. An interbank payment disruption that coincided with less favorable banking conditions could be more difficult to manage, given current daylight credit policies.