The U.S. Securities and Commission has reportedly sent a letter to at least one exchange regarding insider trading.
The SEC is investigating whether crypto exchanges are adequately preventing insider trading, according to FOX Business.
SEC Reportedly Investigating Crypto Exchanges
The SEC has reportedly begun to send letters to crypto exchanges in order to determine whether they have safeguards to prevent insider trading.
Citing an unnamed source, FOX Business reported Tuesday that the SEC had sent one letter to an exchange on the matter to date. The source quoted said they believe that the SEC is engaging in similar wide-ranging interactions with the industry.
It is not clear which exchange received the letter. According to FOX Business, Binance, Coinbase, FTX, and Crypto.com all declined to comment.
It is also unclear whether the inquiry is being carried out by the SEC’s enforcement division or its Office of Compliance Inspections and Examinations. The former would indicate that the SEC is undertaking a more serious investigation than the latter.
Though the SEC has not made a public statement on the matter, there is a connection to previous comments from SEC chair Gary Gensler. In May, Gensler said that exchanges do not fully separate services such as custody, market making, trading, and stablecoin issuance. He criticized exchanges for “trading ahead of their customers” and “market making against their customers.”
Insider Trading Attracting Attention
Outside of the SEC, crypto insider trading has recently started to attract attention. Earlier this month, former OpenSea employee Nate Chastain was indicted by the U.S. Department of Justice over insider NFT trading.
Meanwhile in March, a report published by The Wall Street Journal alleged that Coinbase, Binance, and FTX had facilitated insider trading of Gnosis’ GNO token. All three exchanges denied those claims and the allegations did not develop into a legal case. Coinbase CEO Brian Armstrong responded by publishing a full-length response to the claims.
The U.S. Commodity Futures Trading Commission also probed Binance in an insider trading investigation last September.
Disclosure: At the time of writing, the author of this piece owned BTC, ETH, and other cryptocurrencies.
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
SEC Expands Probe Into Terraform Labs UST Marketing: Report
The U.S. Securities and Exchange Commission has reportedly expanded its Terraform Labs investigation beyond the Mirror Protocol probe and into the company’s marketing practices concerning its now crumpled UST stablecoin….
Terraform Labs Loses Appeal, Ordered to Comply With SEC Investigation
The U.S. Court of Appeals has ordered Terraform Labs and its CEO Do Kwon to comply with SEC’s investigation into the Mirror Protocol on federal securities laws infringement allegations. Terraform…
Binance Faces SEC Scrutiny Over 2017 BNB Coin Offering
BNB has fallen 8.5% since the news first surfaced. Binance Hit by SEC Investigation The Securities and Exchange Commission is investigating Binance over its BNB initial coin offering. Per a…
