New York AG Considers Crypto Exchanges Vulnerable To Manipulations Of Market
According to the monthly report of the New York State Attorney General's Office (AG Office), crypto exchanges are vulnerable to market manipulations and have no sufficient base of consumer protection measures, required for regulated financial markets.
Barbara Underwood, the Attorney General, noticed that crypto investors employ the services of trading platforms, which call themselves "exchanges". Such platforms conduct transactions between buyers and sellers like usual exchanges and brokers, but unlike the listed traders, the existing digital platforms aren't registered according to the state or federal securities laws.
The report states that crypto exchanges do not follow generally accepted safety standards for a client and an investor.
This spring, Eric Schneiderman, the former New York AG, sent questionnaires to the crypto exchanges and required them to report on financing, transactions transparency, and investor protection.
Only 10 crypto exchanges, including Coinbase, provided the information. Meanwhile, four other platforms refused to report. For instance, Jesse Powell, the head of Kraken, stated on Twitter that such a thorough investigation by AG Office is "tone deaf" and "insulting." After the post, the representatives of a few other exchanges refused to fill in the questionnaires as well.
Somebody has to say what everybody's actually thinking about the NYAG's inquiry. The placative kowtowing toward this kind of abuse sends the message that it's ok. It's not ok. It's insulting. https://t.co/sta9VuXPK1 pic.twitter.com/4Jg66bia1I— Jesse Powell (@jespow) April 18, 2018
AG Office, jointly with the New York Department of Financial Services (NYDFS), is currently investigating the actual location of the crypto exchanges, who refused to provide the data (Binance, Gate.io, Huobi, and Kraken), and potential violations of the digital currency standards throughout the state.
Earlier, Jesse Powell stated that the cryptocurrency total capitalization will skyrocket up to $1 trillion by the end of this year.