Cryptocurrencies Down After SEC Asks Crypto Exchanges To Register

Bitcoin Fall SEC 030818

Bitcoin and other major cryptocurrencies were losing value after the Securities and Exchange Commission asked exchanges trading digital currencies to register with the agency.

In a statement, the US regulator said, "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 regulator also said that an entity seeking to operate as an alternative trading system or ATS is also subject to regulatory requirements, including registering with the SEC as a broker-dealer and becoming a member of a self-regulatory organization or SRO.

Bitcoin, which was trading around $11,000 for the past few days, fell below $10,000 following this.

Bitcoin was trading at $9,821.65, down 8.8 percent over the last 24 hours; Ethereum was 8 percent lower at $746.85; and Ripple was down 7 percent at $0.86, according to Coinmarketcap.

The SEC warned investors that many online trading platforms referring to themselves as exchanges are unregulated.

The SEC noted that even though some of these platforms claim to use strict standards for picking digital assets, the SEC does not review these standards or the digital assets that the platforms select. Also, the agency does not review the trading protocols used by these platforms.

The regulator has been taking strict stand against cryptocurrencies for long and has issued subpoenas to many companies in its efforts to establish better control over such trading platforms and exchanges. SEC Chief Jay Clayton often has expressed concerns about cryptocurrencies and initial coin offerings or ICOs.

At a joint senate hearing of SEC and Commodities and Futures Trading Commission or CFTC, Clayton reportedly talked about practical regulations for exchanges and investors dealing with Bitcoin and Ethereum, while adding tighter regulations for ICO.

Recently, a Reuters report said the U.S. Treasury's financial crime division told Congress in a letter that some ICOs may also be subject to the Treasury's money transmission registration, anti-money-laundering and Bank Secrecy Act requirements.

Bitcoin and other cryptocurrencies have been highly volatile of late with significant daily fluctuations in their prices as regulators and central banks around the world are trying to get a grip on the market.

Bitcoin price, which was around $1,000 in January 2017, had peaked to nearly $20,000 in mid-December before plunging almost 70 percent to $6,200 in early February 2018.

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