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Cryptos Continue to Fall as SEC Warns Against “Unlawful” Exchanges

CryptocurrencyMar 08, 2018 08:03AM ET
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© Reuters. Bitcoin continued to fall after an SEC announcement.

Investing.com - Bitcoin and other virtual currencies continued to fall on Thursday, after the Securities and Exchange Commission issued a warning about cryptocurrency exchanges.

Bitcoin was trading at $9,757.10, down 7.88% as of 8:01 AM ET (13:01 GMT) on the Bitfinex, not far from its overnight low of $9,572.

The SEC warned investors against “unlawful online platforms” on Wednesday, saying that any exchange that trades digital assets that are securities need to be registered with the regulator. Many cryptocurrency platforms are not, the agency stated.

“Although some of these platforms claim to use strict standards to pick only high-quality digital assets to trade, the SEC does not review these standards or the digital assets that the platforms select, and the so-called standards should not be equated to the listing standards of national securities exchanges,” the agency said.

The SEC announcement was the same day that virtual currency exchange platform Coinbase said it will introduce a weighted index fund aimed at first-time cryptocurrency investors. As the virtual currencies grow in popularity, regulators around the world have been debating about the best way to regulate cryptocurrencies.

Meanwhile, on Tuesday U.S. District Judge Jack Weinstein ruled that the CFTC could file a fraud lawsuit against New Yorker Patrick McDonnell and his company Coin Drop Markets. The agency has considered Bitcoin to be a commodity since 2015 and Weinstein’s ruling upholds that decision.

Digital currencies were also held back by news that Japan’s Financial Services Agency punished seven cryptocurrency exchanges for not having propers internal control systems. Two exchanges, Bit Station and FSHO, were ordered to stop trading for one month.

Other virtual currencies were down, with rival Ethereum, the world’s second largest cryptocurrency by market cap, falling 5.63% to $743.91 on the Bitfinex exchange. Ripple, the third largest virtual currency, was down 7.40%% to $0.83605 while Litecoin was last at $181.83, a decrease of 6.18%.

Cryptos Continue to Fall as SEC Warns Against “Unlawful” Exchanges
 

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