Crypto.com has reportedly been running internal proprietary trading teams, according to an article published by the Financial Times. The business publication cited five anonymous sources who claimed that the exchange attempted to conceal its trading activities.
Crypto.com operates internal trading operations According To Financial Times Report
Singapore-based cryptocurrency exchange Crypto.com has reportedly been running internal proprietary trading teams, according to an article published by the Financial Times.
The business publication cited five anonymous sources who claimed that the exchange attempted to conceal its trading activities. One insider stated that employees were instructed by management to deny the existence of any internal market maker operation.
Crypto.com, however, has denied any improper relationship between its internal trading operations, referred to as an internal market maker, and its exchange.
The company’s spokesperson informed the Financial Times that the internal market maker operates on Crypto.com’s platform in the same manner as third-party market makers, emphasizing their commitment to ensuring tight spreads and efficient markets.
Internal trading operations have long been a subject of controversy within the cryptocurrency industry, although they are commonly practiced. Companies like BitMEX and Binance have historically operated similar desks to maintain liquidity in markets.
Critics of this business model argue that it may introduce conflicts of interest and increase the risk of front-running customer trades.
The U.S. Securities and Exchange Commission (SEC) has recently targeted Coinbase and Binance in a lawsuit, where it specifically highlighted the integrated model employed by both platforms.
In its complaint, the SEC noted that the Coinbase Platform merges the functions of brokers, exchanges, and clearing agencies, which are traditionally separated in conventional securities markets.
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