Why Bitcoin Crash today?- Bitcoin Price

Bitcoin Dives After SEC Says Crypto Platforms Must Be Registered

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“If a platform offers trading of digital assets that are securities and operates as an ‘exchange,’ as defined by the federal securities laws, then the platform must register with the SEC as a national securities exchange or be exempt from registration,” the SEC said in the statement Wednesday.

 Some of the largest cryptocurrency trading platforms, like Coinbase Inc.’s  GDAX, aren’t registered as a exchange with the SEC, and instead have money transmission licenses with separate states. In the case of Gemini, it’s regulated by the New York  Financial Services as a trust company, according to its website. Templum LLC is an affiliate to Liquid M Capital, which is registered as an alternative trading system with the SEC. Overstock.com Inc.’s tZero says it aims to be a fully-compliant trading platform.

Many platforms are referring to themselves as “exchanges,” which can give the “misimpression” to investors that they are regulated or meet the regulatory standards of a national securities exchange, the SEC said in its statement, warning that it doesn’t review the trading protocols used by these platforms and that access to a platform’s trading services may not be the same for all users.

The SEC statement was issued by its trading and markets unit and its enforcement division, which investigates misconduct and fines firms for violating securities rules. The enforcement division’s involvement shows the potential pitfalls for digital-coin platforms that don’t heed the SEC’s warning to register with the agency: they could be sued and shut down.

Exchanges that register with the agency have a high compliance burden, including being subject to inspections. They are also required to police their markets and follow SEC rules designed to ensure fair trading.

Users of Binance complained online that their accounts got hacked. Binance users on social networks Reddit and Twitter said hackers sold their smaller coins and bought a cryptocurrency called Viacoin, which is up 28 percent today, according to CoinMarketCap.

“All funds are safe,” wrote Zhao , chief executive officer of Binance, in a tweet Wednesday. “There were irregularities in trading activity, automatic alarms triggered. Some accounts may have been compromised by phishing from before. We are still investigating.”

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