Yes, you are absolutely right.
Its the most important thing today required for these exchanges. Altogether with cryptocurrency, crypto exchanges also lack the security measures due to not having regulations. As we have regulators for forex brokers, cryptocurrency exchanges needs the same way a regulatory body to keep things in control.
This will be beneficial to both. Exchanges will be secured(many cyber attacks are happening now a days stealing billions, which is investors money)
Also adding strict KYC procedures, will insure only genuine investors/traders will join the system.
Having regulations, the trading will be as per the standards and as you mentioned regarding pumps and dumps, it will not happen. Investors can then trust the exchanges and can trade on real price of coins.
As per the ccn.com article , The study reveals that 88% of crypto exchanges want regulation, as they believe it could stabilize prices and create a level of certainty that the market has not experienced for a while.
So seems soon will see the regulation part on these exchanges.
Topic: Most Crypto Exchanges are Not Regulated (Read 130 times)
One of the major obstacles to wide-scale cryptocurrency adoption is that crypto-asset service providers remain mostly unregulated. This is problematic because it affects the credibility of this asset class, as well as the industry as a whole. Enforcement of KYC/AML regulations remains a debated issue in the industry. In a study conducted by analytics firm P.A.ID Strategies, it was found that 68% of crypto exchanges are not KYC compliant. Not only does this deter contributors from putting money into an unsecured system, but it could also lead to money-laundering activities.
Lack of KYC/AML Initiatives Driving Rise in Criminal Activities
Lack of initiative in following KYC/AML protocols has led to a rise in illegal activities and fraudulent behaviour. According to a recent report, 97% of criminal Bitcoin money flows into unregulated cryptocurrency exchanges. The report also mentions that within the first three quarters of 2018, $927 million worth of cryptocurrency was stolen from exchanges around the world.
Pump and Dump Schemes
In a recent report by the Wall Street Journal, it was established that even the top exchanges in the world are not immune to pump and dump scams. Anonymous users create communities of investors in pump and dump groups, to organise a fake rally for a token. Unsuspecting investors join the rally and purchase tokens, thinking that the price will continue to climb. Troublemakers can sell-off the tokens once the pre-established price levels are reached. This is financial fraud which significantly impacts market balance. Volatility surges and traders lose money.
To counteract such high uncertainty and instability in the crypto industry, today 88% of the exchanges want to get regulated. IronX will be a fully regulated exchange, having obtained licensing from the Estonian Financial Intelligence Unit. The exchange aims to provide users with peace of mind, through regulated operations, storage of funds, high-speed network and superior information protection.
Lack of KYC/AML Initiatives Driving Rise in Criminal Activities
Lack of initiative in following KYC/AML protocols has led to a rise in illegal activities and fraudulent behaviour. According to a recent report, 97% of criminal Bitcoin money flows into unregulated cryptocurrency exchanges. The report also mentions that within the first three quarters of 2018, $927 million worth of cryptocurrency was stolen from exchanges around the world.
Pump and Dump Schemes
In a recent report by the Wall Street Journal, it was established that even the top exchanges in the world are not immune to pump and dump scams. Anonymous users create communities of investors in pump and dump groups, to organise a fake rally for a token. Unsuspecting investors join the rally and purchase tokens, thinking that the price will continue to climb. Troublemakers can sell-off the tokens once the pre-established price levels are reached. This is financial fraud which significantly impacts market balance. Volatility surges and traders lose money.
To counteract such high uncertainty and instability in the crypto industry, today 88% of the exchanges want to get regulated. IronX will be a fully regulated exchange, having obtained licensing from the Estonian Financial Intelligence Unit. The exchange aims to provide users with peace of mind, through regulated operations, storage of funds, high-speed network and superior information protection.
Jump to: