Home / Crypto Currency / Winklevoss-Led Gemini Calls for Cryptocurrency Exchanges to Form Self-Regulatory Body

Winklevoss-Led Gemini Calls for Cryptocurrency Exchanges to Form Self-Regulatory Body


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Cameron and Tyler Winklevoss, the founders of cryptocurrency exchange Gemini have unveiled a proposal that seeks to see US cryptocurrency trading platforms establish a self-regulatory organization (SRO).

The brothers announced their proposal for the “Virtual Commodity Association” (VCA) in a blog post, arguing that such an organization is necessary to help the market continue to grow and mature.

They wrote:

“We believe a thoughtful SRO framework that provides a virtual commodity regulatory program for the virtual commodity industry is the next logical step in the maturation of this market. We look forward to engaging with industry leaders, participants, regulators, and legislators on this proposal.”

The VCA would be open to all cryptoasset trading venues that serve US customers, and members would have to agree in writing to submit to certain rules governing security, fiscal management, and information sharing. Members would not be allowed to list security tokens unless they obtained securities trading licenses.

The Winklevoss twins have been among the industry’s most vociferous voices in favor of regulation. Gemini, notably, is one of a select group of companies to be granted a BitLicense under New York’s controversial cryptocurrency regulatory framework.

At present, the Commodity Futures Trading Commission (CFTC) classifies Bitcoin and other cryptocurrencies as commodities, meaning that their cash markets are not subject to CFTC oversight unless fraud or market manipulation occurs.

However, the brothers noted in their proposal that cryptoassets fill a very different role in the marketplace than oil, grain, and other commodities. They pointed to the “strong speculative interest” fueling demand for cryptoassets, the relative dearth of commercial use cases, the low transaction costs associated with trading these assets, and the large number of individual investors who participate in these markets as reasons to adopt new self-regulatory standards.

Calls for exchanges to establish a self-regulatory body intensified recently after Securities and Exchange Commission (SEC) released a statement warning cryptocurrency exchanges that it was a violation of federal regulations for them to list ICO tokens the agency classifies as securities.

CFTC Commissioner Brian Quintenz — who last month encouraged exchanges and other market players to embrace self-regulation and adopt standards for cybersecurity, insider trading, and ethical codes of conduct –praised Gemini’s proposal in a statement posted on the CFTC website.

“Ultimately, a virtual commodity SRO that has the most independence from its membership, the most diversity of views, and the strongest ability to discover, reveal, and punish wrongdoing will add the most integrity to these markets. I encourage Gemini (or any other market participant, advocacy group, platform, or firm) to be aggressive in promoting these qualities within any SRO construct,” he said.

Notably, US exchanges are not the only ones considering adopting self-regulatory standards. Earlier this month, Japan’s 16 licensed cryptocurrency exchanges announced that they were forming a self-regulatory body — a move that came in response to the high-profile hack of Tokyo-based exchange Coincheck, which has still yet to receive regulatory licensure.

Featured image from Shutterstock.

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Law enforcement in Ukraine has arrested four young men who were running at least six fake cryptocurrency exchanges. The cryptocurrency sphere is an exciting space, and many people are eager to begin buying and selling virtual currencies. However, such an influx of money and inexperienced newcomers also bring out the criminal element, seeking to gain funds at the expense of those new to the space. Scams abound, but police in Ukraine have done their part by arresting some individuals who ran a number of fake cryptocurrency exchanges. Using Programming Skills to Set up Scams In the city of Dnipro, Ukraine, police announced that they had arrested four men between the ages of 20 and 26. The quartet had set up a number of fake cryptocurrency exchanges. Police know of six fake exchanges that they operated, but there is a definite possibility that there may be more. The six fake exchanges include: moneycraft.info, wowex.online, swapex.net, myexchanger.lv, iconvex.net, and likechange.biz. Police say that the criminals had “special knowledge and skills in the field of programming” and “have created their own CMS-system for managing the content of exchange sites.” Unsure of Amount Stolen Police are asking those who were scammed by the fake cryptocurrency exchanges to come forward and file complaints. As of now, law enforcement does not know exactly how much the four men were able to steal from their victims. Police may be able to glean such information from the equipment that was seized during the arrests. It was reported that flash drives, computers, smartphones, and other equipment were confiscated when police raided the homes of the four men. The reality is that crime and scams are rampant in the cryptocurrency sphere. One should always do due diligence before spending any money. The world of virtual currencies is still akin to that of the Wild West, which means that danger is just as close as excitement and opportunity. Have you ever been scammed by a fake exchange, wallet, or ICO? Let us know in the comments below. Images courtesy of Shutterstock. The post Police Arrest Four Ukrainians for Running Fake Cryptocurrency Exchanges appeared first on Bitcoin Network, News, Charts, Guides & Analysis.

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