Trading Teams at Crypto Exchange Raise Conflict Questions (ft.com) 15
Crypto.com, the exchange endorsed by Hollywood actor Matt Damon, deploys internal teams to trade tokens for profit, the latest sign of potential conflicts of interest in the digital assets industry. Financial Times: The Singapore-based group, one of the top-10 crypto marketplaces in the world, operates proprietary trading and market making teams, according to five people with direct knowledge of the matter. In most markets, exchanges match buyers with sellers at the most competitive transparent price. Market making and prop trading are usually conducted by separate private companies.
US regulators have begun clamping down on similar activities at other digital asset exchanges. This month the US Securities and Exchange Commission hit Binance, the world's biggest crypto exchange, with 13 charges including using a trading firm owned by chief executive Changpeng Zhao to engage in "manipulative trading that artificially inflated the platform's trading volume." "These trading platforms, they call themselves exchanges, are commingling a number of functions," SEC chair Gary Gensler told CNBC on June 6, adding: "In traditional finance, we don't see the New York Stock Exchange also operating a hedge fund, making markets." The existence of internal traders at Crypto.com has not been widely known since the company launched in 2016. One of the people with direct knowledge about the teams said that Crypto.com executives gave other, external trading houses "absolutely dramatic sworn statements that Crypto.com was in no way involved in trading," while another said that employees were asked to "say there is no internal market maker type operation."
US regulators have begun clamping down on similar activities at other digital asset exchanges. This month the US Securities and Exchange Commission hit Binance, the world's biggest crypto exchange, with 13 charges including using a trading firm owned by chief executive Changpeng Zhao to engage in "manipulative trading that artificially inflated the platform's trading volume." "These trading platforms, they call themselves exchanges, are commingling a number of functions," SEC chair Gary Gensler told CNBC on June 6, adding: "In traditional finance, we don't see the New York Stock Exchange also operating a hedge fund, making markets." The existence of internal traders at Crypto.com has not been widely known since the company launched in 2016. One of the people with direct knowledge about the teams said that Crypto.com executives gave other, external trading houses "absolutely dramatic sworn statements that Crypto.com was in no way involved in trading," while another said that employees were asked to "say there is no internal market maker type operation."
Crypto companies potentially violating the law? (Score:1)
Old Illegal Practices Are New Again (Score:3)
Is this self-dealing or insider trading or both?
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No! It's just freedom... to scam.
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Embrace the healing word of AND.
It doesn't raise "conflict questions" (Score:3)
"Question" implies that there might be a conflict or there might not. Only a dissembling prick would argue that it's open for debate. You don't need a question when a statement will suffice.
Dissembling prick = Unwilling lawsuit target (Score:1)
Absent documentary evidence of same, it might not be wise to make statements on the record implying either criminal conduct or tort liability, when the targets of such statements have very deep pockets.
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Yeah, I get it. As always, deep pockets generally protect you against... everything. Having documentary evidence wouldn't protect you any better than if all you have is a suspicion. You have to be able to afford to protect yourself. So, I don't disagree. It just bothers me that the wisdom is, "Be afraid to speak plainly of the rich."
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The press has been doing this for a long time, it's why the headlines we like to make fun of always use words like 'could' or ask questions like "Does...". There's a lawyer involved in those decisions, most of the time.
The mealy mouthed nature of it sucks, but it is what it is.
Scammers gonna scam (Score:2)
And anybody caught in the scam deserves a punishment for their greed.
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The more people get hurt, the more indication that the frauds and abuses are successful and the more likely they are to continue. Do study up on predator and prey relationships, they play out daily in the marketplace.
Scammers preying on each other = hilarious (Score:1)
The more chumps who get hurt by their own gullibility the better. One cannot say they don't deserve it when they should know better.
If someone deliberately walks into a spinning propeller, they're not a "victim", it's their choice.
So how do you call this? (Score:2)
Insider trading?
How's this news? (Score:3)