Crypto.com Has Internal Teams to Trade Tokens for Profit: The Financial Times
According to a recent report by prominent news outlet The Financial Times, the digital exchange endorsed by Hollywood star Matt Damon in a commercial has shown signs that there may be a potential conflict of interest in the crypto space.
Crypto.com alleged to be conducting internal trading operations
Anonymous sources have told FT that the top crypto exchange headquartered in Singapore runs its own teams for trading and market making. The sources are five people in the know, according to the article.
Recently, U.S. regulatory authorities have started cracking down on other crypto exchanges for similar allegations. Last week, the securities regulator hit Binance with a lawsuit, filing dozens of charges. They include Binance chief CZ owning a trading company, whose goal is manipulative trading in order to artificially inflate the trading volume of Binance. As a reminder, this platform is the largest in the world by this crucial metric.
Chairman of the SEC Gensler stated that crypto exchanges "are commingling a number of functions." He referred to the NYSE, saying that it does not operate hedge funds and is not a market maker, unlike crypto trading platforms, like Binance, and regular stock exchanges are not allowed to do that.
FT stated that internal trading at Crypto.com has not been noticed since the company entered the market in 2016.
FT: The crypto Exchange Cryptocom operates internal proprietary trading and market making teams to be the customers’ counterparty to improve order book liquidity for transactions and ran as a broker model.
— Wu Blockchain (@WuBlockchain) June 19, 2023
Cryptocom executives gave other, external trading houses “absolutely in…
Alex DovbnyaHere's what platform has to say about this
According to the five people "with direct knowledge of the matter," executives of the aforementioned exchange told the members of their trading team to say, if asked, that no internal trading operations exist.
Crypto.com denied that. It admitted that such a trading and market making team exists. However, according to the response of the exchange to FT, the trading team is treated like any other third-party trader. Besides, they are trading not only on Crypto.com but on other exchanges as well, according to the comment.
Besides, Crypto.com stated that the main task of the trading team is to make sure that the company's risks remain low by hedging certain positions on Crypto.com, and several other exchanges as well.
The sources still claim that through its own teams, Crypto.com is only trying to boost liquidity on the platform and make profits.
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