New York attorney general Eric Schneiderman has launched a fact-finding investigation into cryptocurrency exchanges, asking 13 platforms - including Coinbase, bitFlyer and Kraken - for details about their businesses.
The Virtual Markets Integrity Initiative will look into the policies and practices of platforms used to trade the likes of Bitcoin and Ether in an effort to improve transparency and accountability, says Schneiderman.
The Attorney General's office has sent letters to 13 major players in the nascent industry, attaching questionnaires asking for information on six issues: ownership and control; basic operation and fees; trading policies and procedures; outages and suspensions of trading; internal controls; and privacy and money laundering.
Other areas covered by the questionnaire include the exchanges' approach to combating suspicious trading and market manipulation; their policies on the operation of bots; their limitations on the use of and access to non-public trading information; and the safeguards they have in place to protect customer funds from theft, fraud, and other risks
Says Schneiderman: "With cryptocurrency on the rise, consumers in New York and across the country have a right to transparency and accountability when they invest their money. Yet too often, consumers don’t have the basic facts they need to assess the fairness, integrity, and security of these trading platforms.
"Our Virtual Markets Integrity Initiative sets out to change that, promoting the accountability and transparency in the virtual currency marketplace that investors and consumers deserve."
The 13 exchanges to receive letters are: Coinbase, Gemini Trust Company, bitFlyer USA, iFinex, Bitstamp USA, Payward (Kraken), Bittrex, Circle Internet Financial, Binance, Elite Way Developments, Gate Technology, itBit Trust Company, and Huobi Global.