Due to the recent manipulation in the crypto market, which has become a burden to so many crypto firms and traders. A group of firms have decided to form an alliance against manipulations in the market.
Crypto Firms Aims to Fight Market Manipulation
According to a report on February 7, a group of major cryptocurrency companies including Circle, Anchorage Digital and Huobi Global are forming a new alliance aimed at fighting market manipulation to inspire confidence in the burgeoning digital asset industry.
The Crypto Market Integrity Coalition, convened by risk monitoring software company Solidus Labs, is also urging digital currency companies to sign a “market integrity” pledge, outlining the potential for fraud in the cryptocurrency space and the industry’s need to protect investors. be acknowledged.
“It really is about recognizing that you need entities that are focused on a fair and orderly system here, and really trying to prevent the abuses that can happen if you’re not paying attention,” said Kathy Kraninger, vice president of regulatory affairs at Solidus Labs and former director of the Consumer Financial Protection Bureau.
SEC Cites Market Manipulation as Top Reasons for Rejecting Bitcoin ETF Application
The new alliances and commitments come as regulators remain concerned that the new market is safe for investors despite its rising popularity. The SEC cited the potential for market manipulation as one of the top reasons for rejecting multiple spot Bitcoin exchange-traded fund applications.
Recently, the market watchdog rejected a proposal by Fidelity’s Wise Origin Bitcoin Trust to offer an ETF that tracks cryptocurrencies, noting that it did not meet standards to prevent fraudulent and manipulative practices.
In December, the Bank for International Settlements called for more regulatory protections to prevent crypto fraud, arguing that the limited application of anti-money laundering rules and the anonymity of transactions expose DeFi to illegal activities and market manipulation.
While this new exposure is an important admission of potential fraud in the crypto space, it remains unclear exactly how the decentralized finance industry will curb bad actors.
The other founding members of the alliance are CrossTower, BitMex, GSR, Bitstamp, Elwood, CryptoCompare, Securrency, MV Index Solutions, Digital Chamber of Commerce, Global Digital Finance and CryptoUK.
Dante Disparte, Circle’s chief strategy officer and head of global policy stated that the alliance should help harmonize the standards of financial integrity among market participants as many await greater regulatory clarity.
He added that integrity is critical to the industry’s progress and ability to continue to innovate and build an infrastructure that delivers on the promise of access to financial resources for all.
While the group will initially focus on getting more companies to sign up to its pledge, eventually the CMIC hopes to work with regulators, facilitate training programs, and support a data-sharing framework that can help resolve cryptocurrency transparency issues to tackle
