The New York Attorney General has required thirteen major cryptocurrency exchanges to provide information on their operations and internal controls.
New York Attorney General Eric T. Schneiderman has launched the “Virtual Markets Integrity Initiative”, an “inquiry into the policies and practices” of digital currency trading platforms, according to a press release April 17.
As part of the initiative, letters were sent to thirteen major cryptocurrency exchanges, requesting information on their operations, internal controls, and other key issues. Schneiderman said in the statement:
“With cryptocurrency on the rise, consumers in New York and across the country have a right to transparency and accountability when they invest their money. Yet too often, consumers don’t have the basic facts they need to assess the fairness, integrity, and security of these trading platforms. Our Virtual Markets Integrity Initiative sets out to change that, promoting the accountability and transparency in the virtual currency marketplace that investors and consumers deserve.”
As part of an effort to protect cryptocurrency investors and users, and increase transparency in how virtual currency trading platforms operate, a three-page questionnaire was delivered to the exchanges. The questionnaire asks the platforms to provide information such as their approach to fighting market manipulation, operation of bots, usage of non-public trading information, and protection of customer funds.
The action reportedly aims to bring average investors a better understanding of the risks and protections associated with cryptocurrency trading platforms. The statement said:
“Often, the platforms lack the basic market protections of traditional investing platforms. Moreover, the extent of disclosures to customers about trading rules, internal controls, and other basic practices varies from platform-to-platform, making it difficult or impossible for prospective users to evaluate the actual risks of trading on a particular platform.”
Letters were sent to cryptocurrency exchanges such as Coinbase, Inc. (GDAX), Gemini Trust Company, bitFlyer USA, Inc., iFinex Inc. (Bitfinex), Bitstamp USA Inc., Payward, Inc. (Kraken), Bittrex, Inc., Circle Internet Financial Limited (Poloniex LLC), Binance Limited, Elite Way Developments LLP (Tidex.com), Gate Technology Incorporated (Gate.io), itBit Trust Company, and Huobi Global Limited (Huobi.Pro).